German consumption in rude health
Donald Trump’s spectacular journey from Trump Tower to the White House appears not to have had any impact on the German economy to date.
However, it may take sometime for the ripples or waves to hit Berlin.
The general consensus is that uncertainty and pessimism,
two ingredients that induce allergies in the financial sector, are the order of the day, tomorrow and many years to come.
German economy unfazed by election of Trump – Ifo economist – MUNICH, Nov 24 (Reuters) – Republican Donald Trum… https://t.co/2rbLwdvuh3
— Knowsis Industrial (@KnowsisIndustry) November 24, 2016
Klaus Wohlrabe is an IFO economist:“Right now we are not seeing a huge impact on the result of our poll after Trump’s election. After the Brexit vote there was a two-month delay. That’s when we noticed an increase in uncertainty. This could happen again, that companies will become more sceptical or more cautious in December. After all, Trump’s remarks are very erratic, meaning that we first need to see what is actually implemented from the things he announced during the election campaign.”
In the third quarter the German economy halved to 0.2 percent as a result of weak foreign trade.
In contrast private consumption remained on an upward trend with consumers happy with high employment, wage rises and low interest rates.
— Deutsche Bundesbank (@bundesbank) November 24, 2016
German government spending is contributing to growth as the country accommodates more than one million migrants who have arrived since the start of 2015.