Merkel Advisers Slash 2020 Growth Forecast to 0.9%, FAZ Says
Merkel Advisers Slash 2020 Growth Forecast to 0.9%, FAZ Says
(Bloomberg) --
The German government’s economic advisers have slashed their growth forecast for next year to 0.9%, Frankfurter Allgemeine Zeitung newspaper reported, citing an annual assessment to be delivered Wednesday to Chancellor Angela Merkel.
This year, Europe’s biggest economy will expand by just 0.5%, the advisers predicted in their latest analysis, but will likely avoid a “broad and deeper” recession, FAZ quoted the report as saying.
In March, the panel -- which includes Isabel Schnabel, Germany’s nominee to succeed Sabine Lautenschlaeger on the European Central Bank’s Executive Board -- expected growth of 1.7% in 2020 and 0.8% in 2019. A spokeswoman for the panel declined to comment when contacted by Bloomberg.
The advisers also addressed the ECB’s recent decision to expand monetary support for the euro-region economy, Handelsblatt reported.
“It would have been better to at least have avoided new purchases of government bonds, because this policy can have significant risks and repercussions,” the paper quoted them as saying.
The Federal Statistics Office is due to publish a first estimate of third-quarter gross domestic product on Nov. 14. GDP contracted 0.1% in the second quarter and waning demand for German exports, as well as uncertainty fueled by Brexit and trade disputes, may have helped tip the economy into a technical recession in the July-September period.
The advisers are due to give a news conference in Berlin at 1200 local time on Wednesday, after presenting their report to Merkel at the chancellery.
To contact the reporter on this story: Iain Rogers in Berlin at irogers11@bloomberg.net
To contact the editors responsible for this story: Chad Thomas at cthomas16@bloomberg.net, Jana Randow
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