Thursday, April 25, 2019
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Economy: Business practices lower their forecast

In view of high risks in the world economic development and capacity bottlenecks, the economies are likely to lower their economic forecast. The German Council of Economic Experts (Sachverständigenrat) assesses the overall economic development for the current year only by a rise in the gross domestic product by 1.6 percent, among other reports Frankfurter Allgemeine Zeitung,

So far, the experts had expected a plus of 2.3 percent. In 2019, economic growth is expected to reach 1.5 percent. In March, the Council of Experts had assumed 1.8 percent. The business practices present their annual report on Wednesday afternoon in Berlin.

The reasons for this are a shortage of skilled workers, for example in construction or with IT experts, for an increasing problem. In the third quarter, massive problems of the important automotive industry on the new WLTP exhaust gas test method also slowed down growth.

There are risks around the world mainly due to trade conflicts, such as those between the US and China, and the US and the EU. Lower global growth is also affecting the export nation Germany. In addition, there is uncertainty because the UK's exit from the EU remains unclear.

The federal government had lowered its forecasts in mid-October. It expects gross domestic product to grow by 1.8 percent in the current year and 2019. At the same time, German Federal Minister of Economics Peter Altmaier (CDU) emphasized that the German economy will enter its tenth growth year next year. The upswing is increasingly coming to the citizens: Wages rose and unemployment fell

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