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DIW: Hard Brexit would have big impact on German economy

DIW: Hard Brexit would have big impact on German economy
FILE PHOTO: Export cars are loaded on a RoRo ship of Italian Grimaldi Group at a terminal in the port of Hamburg, Germany August 1, 2018. REUTERS/Fabian Bimmer   -   Copyright  FABIAN BIMMER(Reuters)
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BERLIN (Reuters) – A hard Brexit would hit the export-oriented German economy hard, the DIW economic institute said on Wednesday, adding that it was in both Britain and the European Union’s interest to avoid such a scenario.

A hard Brexit is generally understood to be an abrupt exit by Britain from the EU without measures in place to safeguard the economies of both parties.

DIW said the uncertain environment would result in companies and consumers holding back on major spending for now.

DIW also cut its forecast for German 2018 economic growth by 0.3 percentage points to 1.5 percent and lowered its estimate for 2019 growth by 0.1 percentage points to 1.6 percent.

(Reporting by Michelle Martin; Editing by Maria Sheahan)

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