The German economy contracted, as initially estimated, in the second quarter due to weak household consumption and investment, official data revealed Tuesday.
Gross domestic product fell 0.1 percent sequentially, in line with the flash estimate, following a 0.2 percent rise in the first quarter, final results from Destatis showed.
After the slight increase in the previous quarter, the German economy cooled down again in the spring, said Destatis President Ruth Brand.
Calendar-adjusted GDP stagnated on a yearly basis in the second quarter, in contrast to the 0.1 percent decline estimated initially. This follows a 0.1 percent drop in the first quarter.
Price-adjusted GDP advanced 0.3 percent, reversing the 0.8 percent decline in the first quarter.
On the expenditure-side, private consumption slid 0.2 percent following a revised 0.3 percent rise a quarter ago. On the other hand, government spending rebounded 1.0 percent.
Investment in equipment fell more sharply by 4.1 percent and that in buildings decreased 2.0 percent.
There was no positive contribution from foreign trade in the second quarter as exports decreased 0.2 percent, while imports remained flat.
ING economist Carsten Brzeski said the German economy is stuck in stagnation. The economist said, "It is still too early to give up hope, even if the outlook is not very bright."
Hopes of a consumer-driven recovery in the second half of the year got another hit this morning with consumer confidence dropping.
A monthly survey data from the market research group Gfk today showed that the forward-looking consumer confidence index fell to -22.0 from revised -18.6 in August. Income and economic expectations of consumers suffered noticeable losses in August. The propensity to buy also deteriorated somewhat.
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December 19, 2025 15:10 ET U.S. inflation data and interest rate decisions by major central banks were the highlights of this busy week for economics news flow. Employment data and survey results on the housing markets also gained attention in the U.S. In Europe, the European Central Bank and Bank of England announced their policy decisions and macroeconomic projections.