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Business

German Economic Recovery Stalls

The modest recovery of the German economy ran out of steam in the third quarter, official data showed Thursday, as exports, previously the main driving force behind growth of the euro zone's biggest economy, slumped on the back of the global economic slowdown. German gross domestic product (GDP) shuddered to a near-halt in the period from July to September, growing by a meager 0.1 percent, the federal statistics office Destatis calculated. Growth was therefore not only much slower than 0.4 percent recorded in both of the preceding two quarters, but it was the slowest rate of growth of the German economy since the second quarter of 2003, the final quarter of the last recession. Destatis attributed the sharp slowdown to falling exports. Domestic demand, previously seen as the Achilles' heel of the German economy, picked up strongly in the third quarter, Destatis noted. Nevertheless, household spending, a key component of recovery, remained depressed. For the whole of 2004, the German government is currently forecasting full-year GDP growth of around 1.8 percent.