Bundesbank sees German GDP shrinking 7.1% in 2020

Dhwani Mehta FXStreet

According to the latest forecasts published by the German central bank, Bundesbank (Buba), the economy is seen contracting 7.1% in 2020.

Additional takeaways

German stimulus may raise 2020 GDP by more than 1%.

Sees German GDP growth of 3.2% in 2021, 3.8% in 2022.

Projections do not include recent fiscal package.

Fiscal support appropriate, takes positive view on govt’s measures.

Low point in growth appears to have passed in April.

Market reaction

EUR/USD holds the higher ground on the above projections, having hit a new three-month high at 1.1384, despite the collapse in the German Factory Order in April.

The spot adds 0.36% to trade at 1.1375.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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