Germany

The German economy unexpectedly shrank in the fourth quarter, data showed on Monday, a sign that Europe's largest economy may be entering a much-predicted recession, though likely a shallower one than originally feared, Reuters reported. Gross domestic product decreased 0.2% quarter on quarter in adjusted terms, the federal statistics office said. A Reuters poll of analysts had forecast the economy would stagnate. In the previous quarter, the German economy grew by an upwardly revised 0.5% versus the previous three months.
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The German government on Wednesday said it expects to eke out economic growth this year instead of a decline as Europe’s largest economy manages its energy divorce from Russia and shells out support for consumers and businesses hit by higher energy costs, the Associated Press reported. The 2023 outlook improved to an 0.2% expansion from a 0.4% contraction that was expected in October, when Germany feared it would run out of natural gas used to power factories, generate electricity and heat homes this winter.
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Jutta Doenges, a former Goldman Sachs Group Inc. banker who also ran Germany’s debt management agency, will take over as chief financial officer of recently nationalized utility Uniper SE, Bloomberg News reported. Doenges will take over on March 1, and replace Tiina Tuomela, whose contract expires, the company said in a statement, confirming an earlier report by Bloomberg. The Dusseldorf-based company suffered massive losses after Russia’s invasion of Ukraine triggered a surge in gas prices, and is in the midst of a management shakeup following a government takeover.
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Deutsche Lufthansa AG said it aims to buy a minority stake in ITA Airways, seeking to advance an industry consolidation that would give the German airline a stronger foothold in a major European aviation market, Bloomberg News. reported. The German carrier didn’t disclose financial details, or lay out the size of the stake it wishes to buy in the successor of Alitalia SpA. Lufthansa wants to buy as much as 40% of ITA in an initial step and subject to negotiations.
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Germany is set to dodge a widely expected recession this year, a source told Reuters on Wednesday, adding to a chorus of voices predicting a brighter outlook for Europe's biggest economy as energy prices fall. Facing soaring gas prices due to the war in Ukraine and supply bottlenecks, consumer prices exploded last year, and the government and economists saw no way around recession. However, a 200-billion-euro relief package to shield consumers from surging energy prices, a mild winter and a readiness to save energy have changed the picture.
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The German government's net borrowing amounted to 115.4 billion euros ($124.48 billion) in 2022, finance ministry sources said on Thursday, as the COVID-19 pandemic and the war in Ukraine led to a rise in debt, Reuters reported. Last year, government borrowing was at its third-highest level in the history of Germany, following a record figure of 215.4 billion euros in 2021 and 130.5 billion in 2020, according to the sources. The German government had envisaged net borrowing of 138.9 billion euros in 2022.
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More than half Germany's companies are struggling to fill vacancies due to a lack of skilled workers, the German Chambers of Commerce and Industry (DIHK) said on Thursday, in the latest sign of growth headwinds belabouring Europe's largest economy, Reuters reported. The proportion of companies facing difficulties hiring was at its highest ever level, the DIHK found in its survey of 22,000 companies, with 53% reporting shortages.
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German landlord Adler Group SA is preparing to overhaul its debt in the UK after getting support from a “sufficient majority” of its creditors for a deal, Bloomberg News reported. The company said it created a new English subsidiary — called AGPS BondCo Plc — as a principal debtor of all its bonds, in a move that will allow it to file a restructuring plan in England, according to a statement. Adler has been negotiating for months with its creditors after it was targeted by a short seller and hit by a slowdown in German property transactions.
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German Neobank Ruuky Files for Insolvency

German neobank Ruuky has filed for insolvency after failing to raise fresh funds, FinExtra.com reported. Launched three years ago under the brand name Pockid, the firm pivoted a year later under the new name Ruuky, offering an interactive banking app, current account and debit card for European teenagers. While the business claims to have amassed a loyal customer base, counting 250,000 app registrations, it has fallen victim to an ongoing drought in VC funding. The startup had previously raised €4 million from Cavalry Venture and Vorwerk Ventures at a valuation of €16 million.
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The chief executive of German utility Uniper SE plans to resign this year after the company, hit hard by Russia’s decision to halt most of its natural-gas exports to Europe, was nationalized by the government, the Wall Street Journal reported. Klaus-Dieter Maubach, who was appointed to the position in 2021, will exercise a special right of termination due to the change of ownership, the company said Tuesday. Uniper’s Chief Operating Officer David Bryson will also depart, using the same right.
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