The battered German economy has been hit by falling production, leaving it unable to meet export demands.


The battered German economy has been hit by falling production, leaving it unable to meet export demands.

The German economy has deteriorated due to a lack of raw materials, which has resulted in production shrinkage.

Due to a shortage of materials, the EU country is having difficulty meeting export demands.

The announcement comes as data suggests that production in the country fell between October and November.

According to the Federal Ministry of Economics, major production lines in industry, construction, and energy supplies dropped by 0.2 percent.

Although the decrease in production is not significant, it is in contrast to the predicted increase in production levels, which some economists believe could be as high as 1%.

Production rates are currently 7% lower than they were in February 2020, when the arrival of the global pandemic COVID-19 imposed restrictions.

The ministry sees reason to be optimistic, given that industry alone was able to increase production by 0.2 percent in November.

However, the effects of delivery bottlenecks are likely to last for a few more months.

“Dynamic growth can be expected following their dissolution, given the full order books,” the ministry predicted.

Surprisingly well-received exports.

According to the Federal Statistical Office, they increased by 1.7 percent in November over the previous month.

Economists had predicted a 0.2 percent decrease.

Imports increased by 3.3 percent, compared to a 1.7 percent drop predicted by analysts.

The order books of the companies are currently overflowing.

However, due to severe bottlenecks in intermediate products like microchips, orders have been unable to be processed in recent months.

At the end of 2021, the material shortage in industry worsened once more: 81.9 percent of companies reported bottlenecks and problems in the procurement of preliminary products and raw materials, a record high.

According to forecasts from leading institutes, the upswing this year will be smaller than previously assumed because the problems are likely to persist for some time.

For example, the Kiel Institute for the World Economy (IfW) has lowered its GDP growth forecast for 2022 from 5.1 percent to 4.0 percent.

Germany is also dealing with record-high inflation, which raises production costs, though the rate did fall slightly in December.

Inflation in Germany slowed for the first time in six months in December, but it remained well above the European Central Bank’s target.

“Brinkwire News in Condensed Form.”


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