GDP Growth – USA and GER

GDP Growth Rates are revealed for the USA and Germany (2019 Q2)

Today we had two important data on the gross domestic production (GDP) figures from the leading economies. Firstly the US Bureau of Economic Analysis (BEA) has released the GDP growth figures and than German Statistics Federal Office (DESTATIS) followed it. Both figures indicate a contraction compared to previous period, but let’s have a closer look.

At the above graph, I have plotted the percentage change in GDP values both annually and quarterly. Figures are seasonally adjusted and chained to a reference year. Annual changes, which compares the data with the same quarter of the previous year, are represented with blue columns and quarterly changes are shown with a red line. As the growth rate declined at the last two quarters of 2018 compared to previous periods, recession fears became disturbing and central banks tried to calm down the situation. Then we had a good first quarter in 2019, but todays figure show that the US economy grows, but again at a lower rate. Growth rate for the second quarter of this year is revealed as 2 percent. This figure is below the last quarters’ 3,1 percent growth and also below the average growth rate of US economy. Annual change is not so sharp with 2,30 percent compared to previous 2,70, but the direction is same, to the South.  

When it comes to German economy the scenario is worse. I have followed the same method as above explained and quarterly changes in GDP growth rate hits at this graphic the negative zone, with a minus 0,1 percent. GDP growth rate in the first quarter was 0,4 percent and now it is hindered.

You can follow the similar patterns on both graphs. Best rates were attained in 2017 and since then we are on a downward trend. One striking difference on the other hand is that, it seems US economy has much room on growth window and distance to the negative area. However, anxiety and demand to US dollars do not make things easier.  

Ergun UNUTMAZ, 03.09.2019