German Government Warns On Economic Headwinds

The German government has said the country’s economy will face sustained headwinds in the coming months, as global trade tensions hit its export industries and the labour market shows signs of a slowdown, the Financial Times reported. Germany’s economy grew 0.4 per cent in the first quarter of 2019, in part because of strong consumer spending. But in a statement, the German economy ministry said the outlook for the second quarter “remains muted”. It is the latest sign that friction sparked by the US’s multi-front trade war is starting to feed into the real economy, especially in Germany, whose reliance on exports makes it particularly vulnerable to turbulence in international trade. The IMF warned last month that recently imposed tariffs by the US and China would cut global growth by 0.3 per cent next year; when earlier tariffs are added, the fund sees a 0.5 per cent hit to growth. Read more