German economy to shrink by 2% in first quarter
Thursday, 03 18 2021, Category: Economy, Country: Germany
The German government’s council of economic advisers said on Wednesday it expected Europe’s largest economy to shrink by roughly 2% in the first quarter of this year due to lockdown measures to contain the COVID-19 pandemic.
The council cut its full-year 2021 gross domestic product growth forecast to 3.1% from 3.7% previously. It expects the economy to reach its pre-crisis level at the turn of the year 2021/22 and to grow by 4% next year.
“The biggest downside risk remains the development of the coronavirus pandemic. The question how quickly the economy can get to normal mainly hinges on the vaccination progress,” the council said in a statement, giving the first official forecast for the impact in the first three months of the year.
Economists have warned that a decision by Germany and several other European countries to suspend AstraZeneca’s COVID-19 vaccine could delay progress in reaching herd immunity and postpone a much hoped for easing of lockdown measures needed for a robust recovery in the second quarter.