The German economy will probably be back to pre-coronavirus levels in the third quarter. According to the German central bank, the economy grew strongly in the second quarter, and even more, substantial growth is expected for the current quarter.
This means that the recovery of Europe’s largest economy is progressing more smoothly than previously thought, helped by the relaxed corona measures and vaccinations.
The Bundesbank says there should be no major new setbacks in the pandemic, and supply chain disruptions should gradually ease.
The Bundesbank did not mention the impact of the floods in parts of Germany in its monthly report. However, according to ING, the impact on the entire German economy is expected to be relatively limited, although the catering and leisure activities in the affected areas will be hit hard.
But the extensive repairs to damaged houses, buildings and infrastructure will stimulate the local economy again, ING believes.