The German economy has narrowly missed tumbling into recession but recorded output growth of just 0.02% in the final quarter of 2018.
In preliminary figures, which could yet be revised, the country’s statistics agency said construction and business spending helped Europe’s largest economy avoid two consecutive quarters of negative GDP growth – a technical recession.
Output in the previous three months – July to September – had been measured at -0.2% as demand in Germany’s export-led economy tumbled amid the world economic slowdown linked to China’s trade war with the US.
Production in the country’s car industry continued to drag on growth given weaker demand – a factor also blamed for a slowdown in UK economic growth to 0.2% between October and December.
Germany’s automotive sector, which counts BMW, Audi and Mercedes among its brands, has also been hit by delays around new emissions checks.
The pressure on Germany’s factories has offset support from a relatively strong domestic economy.
Analysts point to a low unemployment rate of 3.3% and hope that the worst is now behind Germany given renewed hopes of progress in a truce being found to end the trade war.
However, Germany’s export-led model remains particularly exposed in the EU to the continued threat of a hard Brexit.