FX.co ★ German Q1 GDP Growth Higher Than Initially Thought

In the first quarter of 2025, Germany's economy experienced a quarter-on-quarter expansion of 0.4%, according to revised figures, improving upon the initial estimate of a 0.2% increase. This growth follows a 0.2% contraction in the preceding quarter and represents the most significant economic upturn since the third quarter of 2022. The expansion was propelled by increased household consumption, which rose by 0.5% compared to 0.2% in the fourth quarter, and fixed investments, which, while still negative, showed a reduced decline of 0.3% compared to a previous 0.4%. Additionally, net trade contributed positively to GDP, with exports advancing by 3.2% against a previous downturn of 3.1%, buoyed by stronger than anticipated growth in manufacturing output and shipments, as per initial March forecasts. Imports, however, increased at a moderate pace of 1.1%, following a previous decrease of 0.7%. On the production front, several industries reported growth, most notably manufacturing, which rose by 1% compared to a decline of 0.3%, along with information and communications expanding by 1.7% and the trade, transport, accommodation, and food services sectors increasing by 1.1%, up from 0.6%. When viewed year-over-year, the economy remained steady, a marked improvement from the 0.2% decrease in the last quarter and earlier projections of a similar fall.