GERMANY

摘要

The -2.2% (q-o-q) contraction in Q1 GDP was the biggest since 2009 as private consumption, machinery & equipment investment and exports all endured large losses. The downturn would have been deeper had it not been for an acceleration in construction investment. The Bundesbank expects a steeper fall in Q2 as Covid-19 containment restrictions persisted through April. In better news, the Ifo business climate index rebounded in May, lifted by an improved mood on future prospects. Current expectations dipped marginally in a reminder of the huge disruptions to supply chains and key export markets.The less-stable financial situation of households,meanwhile, has added to the fragility of the automotive industry, where confidence is near rock bottom. April's record industrial production slump of -17.9% (m-o-m) included a remarkable -74.6% plunge in automotive output, although this should at least mark the very worst of the crisis. Meanwhile, the unemployment rate jumped to 6.3% in May, up 1.3 percentage points from March. Germany's short-time work initiative (where hours are cut in return for job safety) could prevent a wider surge, however.