Germany's Gross Domestic Product contracts in 3rd Qtr, economy in recession. Euro gains in Currency Trading. | CountingPips Forex Blog

November 13, 2008 - Forex Economic News

Germany's Gross Domestic Product contracts in 3rd Qtr, economy in recession.

The German Gross Domestic Product decreased in the third quarter according to a report by German Federal Statistics Office released today. Germany's economy has entered into a recession as the GDP decreased in the July to September quarter by 0.5 percent following the second quarter GDP decline of 0.4 percent. An economy is widely considered to be in Euro gains in Forex Trading recession when GDP data contracts for two consecutive quarters and this year's recession marks the first German recession since 1996. Market economic forecasts were expecting the GDP data to show a 0.2 percent contraction for the third quarter.

The German economy had grown at a rate of 1.4 percent in the first quarter of 2008. On an annual basis, the 2008 third quarter GDP grew by 1.3 percent over the third quarter of 2007 following the second quarter's revised annual growth of 1.9 percent.

Contributing to the GDP decline was an decrease in exports as the report statement said, "imports recorded a considerable increase and exports saw a decline, the balance of exports and imports had a negative impact on the development of the gross domestic product."

Despite the more than expected decline in German GDP data, the European euro has advanced today in forex trading against the U.S. dollar and Japanese yen after falling for three consecutive days against each currency. The EUR/USD has gained from today's opening exchange rate of 1.2459 to trading at 1.2534 early in the U.S. trading session at 10:45am ET. The EUR/JPY has increased from 119.10 to trading at 120.26 today.

Tomorrow's economic news includes more GDP data as France, Italy and the Eurozone numbers for the third quarter are released. Market forecasts are expecting all three GDP releases to also show contractions. See our economic calendar here.

EUR/USD Chart - The euro has advanced today against the U.S. dollar despite the negative GDP numbers out of Germany. The U.S. dollar had gained verses the euro for the last three days.

Today's Forex & Currency Trading Chart

tags: Germany, GDP, economy, recession, euro

Blog Index