Bundesbank: A Major Setback Is Looming For German Economy
Germany’s economy could suffer a « serious setback » if the authorities decide to prolong austerity measures because of COVID-19. This follows a report from the German Central Bank.
« If the spread of the coronavirus cannot be significantly eased and the current restrictions affecting economic activity are maintained or tightened, it could result in a serious setback [for the country’s economy], » the Bundesbank said in a statement.
The central bank report also clarified that the German economy showed zero growth in the last three months of 2020, as the downturn in the hospitality and retail sectors was offset by a rebound in industry and construction.
On 5 January, German authorities decided to extend the country’s strict lockdown until 31 January. Chancellor Angela Merkel called on all residents to reduce social contacts to an « absolute minimum ». Previously, a regime of severe restrictive measures was in place in Germany until 10 January.
In September 2020, Germany was the only country in the eurozone to show stable economic growth. Growth in global trade is helping to recover from the pandemic and pulling Germany’s export-oriented economy through.