Germany ’ s economy set for small contraction this year
Frankfurt-am-Main , Germany
Bull and bear : two familiar foes meet outside the German Stock Exchange in Frankfurt-am-Main . There are fears that Europe ’ s largest economy could be headed for a deeper recession than first predicted , despite a let-up in interest rates . The International Monetary Fund ( IMF ) believes that Germany ’ s economy will contract by 0.5 % this year and will grow by less than 1 % next year . The IMF blamed the pessimistic forecast on sectors that are particularly prone to high inflation , as well as a slowdown in trading partner demand . Indeed , German exports fell by 1.2 % in August amid weak demand from China .