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English version of ˮDer naive Glaube an den ewigen Aufschwungˮ

August 30, 2019
Region:
Given that in the meantime most official forecasters agree with us that the Germans will suffer at least a technical recession, even German politicians and commentators are starting to join the so far mainly Anglo-Saxon chorus, asking for countercyclical fiscal measures. In our view the government should only act if there is clear evidence that we might be at the brink of a deep recession. Despite the undoubtedly massive economic policy uncertainties we do currently not expect such a scenario. [more]

More documents about "Germany"

270 Documents
May 26, 2020
Region:
Analyst:
1
Cash was in high demand throughout Europe at the start of the coronavirus crisis. In March, euro circulation skyrocketed by EUR 36 bn month on month. Nearly half of that volume consisted of smaller banknotes, which people use to pay for their everyday purchases. In Germany, however, consumers have increasingly been using contactless payments rather than cash since March as they wish to protect themselves against infection and because the retail sector requests that they avoid cash. Contactless card payments may have replaced a certain share of cash payments permanently even though not all customers who prefer cash will change their payment behaviour. [more]
May 25, 2020
Region:
2
Based on DB’s GDP forecast, due to the COVID-19 crisis annual global goods trade will shrink by 13.6% in 2020 and will recover by only 7.5% in 2021. Global goods trade is set to fall much heavier than during the GFC. The COVID-19 crisis might result in a reorganization of global value chains, at least in some sectors. For instance, there are requests to repatriate the provision of medicines and medical devices back to developed markets. However, a more balanced approach between today’s global value chains and a complete repatriation could be continental production close to developed markets. [more]
May 18, 2020
Region:
3
All German export markets will be hit hard by the COVID-19 crisis. We foresee great variation among key countries and expect annual exports to the UK and Italy to decline by around 25% in 2020. Large contractions in German exports are also expected for France, Spain and the euro area as a whole. By contrast, exports to Asia may emerge relatively unscathed from the crisis. We expect exports to the US to shrink by around 10% in 2020. However, this forecast seems particularly uncertain to us as the risk of a new wave of infections and new lockdown measures could be higher in the US than elsewhere. [more]
May 14, 2020
Region:
4
The COVID-19 pandemic and, in particular, lockdown measures will push the German economy into its biggest slump since WW2. The COVID-19 pandemic hits German labour market differently than the Global Financial Market Crisis of 2009. First, it is acting almost simultaneously as a supply shock and, as a result of the measures to restrict contact, as a demand shock. Second, is the speed and the might with which it has brought the economy to a standstill in many areas of Germany and around the world. Third, private consumption will suffer the biggest blow. During previous periods of economic weakness, private consumption has always been a supporting pillar of the German economy and thus also provided a counterweight to employment losses in export-oriented companies. At present, however, the domestically oriented and personnel-intensive service sector is failing as a driver of employment. By April 26th, 751,000 companies had already registered for short-time work. This should imply an increase in the number of people actually on short-time work to up to 10 m. Despite the comprehensive measures to secure employment, which ultimately include support measures for companies, the number of unemployed persons is expected to climb to 3 m in 2020. Employment is likely to fall in 2020 by a good 1%. [more]
May 8, 2020
Region:
5
Weaker-than-expected March hard data and shocking April survey data point to a lower trough in economic activity than assumed so far. We now see Q2 GDP falling by 14% qoq, with the risks still skewed to the downside. In the 2009 recession, private consumption acted as a massive shock absorber. Given the lockdown, social distancing and a likely severe hit to income expectations, we expect private consumption to fall by 10% in 2020. The asynchronous global development of the COVID-19 pandemic and lasting impediments to global trade, will make the recovery, which began in May and will become more evident in H2, less dynamic than hoped for earlier. As a result, we expect German GDP to decline by 9% this year and to expand by about 4% in 2021. [more]
May 5, 2020
Region:
6
The corona crisis is currently overshadowing all other aspects of the German property market. On the assumption of a strong recovery in the second half of the year structural issues will return to the foreground and the pandemic will slow down, but not bring an end to the German property cycle. In this report we look into both the negative effects of the crisis and fundamental factors and assess the outcome for the German house and office market. A flight to safety and the potential increased immigration could have a positive impact in the medium term. [more]
May 5, 2020
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Analyst:
7
Due to the coronavirus, production in the manufacturing sector in Germany is expected to fall by roughly 10% to 15% in real terms in 2020. Society and business will learn to live with the coronavirus and weigh up health, social and economic risks in the process. In 2021, industrial production could rise by more than 10% in real terms on average over the course of the year. However, overall we see a risk that Germany may become less attractive as an industrial location over the coming years. Policymakers and industrial companies are likely to view the crisis surrounding the coronavirus as an opportunity to make important political decisions and get structural reforms off the ground, as they should. [more]
April 29, 2020
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Analyst:
8
The government’s coffers are not bottomless. That is why any money spent on cushioning the impact of the corona crisis should be used as efficiently as possible to achieve the maximum positive impact or compensate for the damage caused by the lockdown. Unlike other sectors, such as hotels or restaurants, car producers in Germany were and are not directly affected by the lockdown. Car dealers have re-opened. Moreover, a car-scrapping bonus scheme will cause customers to bring forward purchases, with sales declining in the following year. In addition, high-wage earners in particular will benefit from the financial windfall. Car sales in Germany play only a limited role for German carmakers’ overall profitability. And finally, subsidies for e-cars already provide an incentive to include environmental considerations in car-buying decisions. [more]
April 20, 2020
Region:
9
The COVID-19 crisis raises the question of whether the increased shift towards working from home will ultimately reduce demand for office space. The longer the crisis continues, the more people will get used to long-distance co-operation – and the more efficient remote communication may become. However, employees and teams experience the corona crisis very differently. Much depends on how well a team worked together pre crisis. [more]
April 17, 2020
Region:
10
The German government has responded quickly and decisively to the economic fallout from the corona pandemic. Altogether, Germany’s anti-crisis measures – consisting of extra spending, guarantees and loan/participation programs – sum up to an astronomic value of around EUR 1.9 tr (well above 50% of GDP in 2019). This gives the government huge scope to fight the pandemic and economic crisis. In this note we try to quantify Germany’s fiscal costs from the corona crisis. [more]
April 16, 2020
Region:
11
Merkel’s cabinet in consultation with the PMs of the 16 federal states agreed to partially lift containment measures but curbing health risks clearly dominated economic risks of a longer shutdown. The decisions taken will be reviewed on a bi-weekly basis with the next meeting of political leaders on April 30. A European coordination of (national) exit strategies is important for Germany given its strong economic interlinkages with other member states. [more]
April 15, 2020
Region:
Analyst:
12
The coronavirus pandemic has struck the German mechanical engineering sector at an already difficult time. Since 2019 at the latest, mechanical engineering firms have been feeling the effects of a realignment in the industry, particularly as German automobile manufacturers shift towards electric mobility. On top of that, there was the possibility of unusual expenses due to the potential discontinuation of deliveries from China amid ongoing trade conflicts. Production may decline by 25% or more in 2020 as a result of the coronavirus. [more]
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