German Economy Will Fall By 5.1 Percent This Year

German Economy Will Fall By 5.1 Percent This Year

According to the AFP agency, economic advisers published a new forecast, the German economy will fall by 5.1 percent this year. These are much better prospects compared to the June estimate, when they expected a decline of up to 6.5 percent. The forecast is also better compared to the government's estimate, which points to a decrease of 5.5 percent. The "very strong" economic recovery in the summer months contributed to the improvement of the forecast, said advisers, also known as the Council of the Wise. On the other hand, the expected economic recovery next year will be weaker than originally reported, according to a new forecast by economists. While the original estimate assumed growth in gross domestic product (GDP) of 4.9 percent next year, economic advisers now expect growth of only 3.7 percent. A group of economic advisers from the German government expects Germany's economy to decline at a much slower pace this year than estimated five months ago. The new estimate is also more optimistic compared to the government's own forecast. At the same time, however, they warned that the recovery next year will be "very fragile". "Due to the sharp increase in the number of people infected with the new coronavirus, the economic situation remains very fragile," said Lars Feld, chairman of the Council of Wise Men, which consists of five economists. He added that the management of the pandemic and how the economic situation in other markets will develop will be crucial for the further development of the German economy. The Council of Wise Men praised the steps taken by the German government as well as the European Central Bank (ECB) to support the pandemic-affected economy. At the same time, however, she warned that emergency measures should end as soon as the economy experiences "sustainable growth".