Data
released today from the German economy showed improved levels of growth during
the fourth quarter, better than expected, in light of strong exports and
construction sector activity that helped the economy continue to grow despite
the negative consequences of closures due to the Corona pandemic.
The
German economy recorded a growth of 0.3% during the fourth quarter of last
year, higher than expectations that indicated a growth of 0.1%, while the growth
rate in the third quarter was 8.5%.
As
for the annual GDP index, it continued to shrink by 3.7% during the fourth
quarter, and the previous reading was witnessing a contraction of 4.0% and
expectations indicated a contraction of 3.9%.
The
statistics office in Germany indicated that the state budget recorded a deficit
of 139.6 billion euros, or 4.2% of GDP, during 2020 as a whole, which is the
first budget deficit since 2011.
The
expansion in the fourth quarter came after a record quarterly growth rate of
8.5% in the third quarter and an unprecedented decline of 9.7% in the second
quarter, due to the effect of Germany's first-time lockdown to slow the
coronavirus pandemic.
The
second shutdown imposed in early November on bars, restaurants and
entertainment venues and expanded in mid-December to include most stores and
services, caused household spending to drop in the fourth quarter.
On
the other hand, exports recorded a growth of 4.5% during the fourth quarter,
while household spending decreased by 3.3%. This means that net trade
contributed 0.6 percentage points to the overall growth rate, while stagnant
domestic activity deducted 0.3 percentage points.
The levels of the
euro rose against the dollar during today's trading, and reached its highest
level at 1.2173, after it opened trading today at the level of 1.2140, and is
currently trading at the level of 1.2160.