Germany experienced a slight increase in its GDP at the beginning of 2025, signaling a positive turn after two years of recession, despite the looming threat of U.S. tariffs. However, the unemployment rate rose in April.
From January to March, Germany’s GDP grew by 0.2% compared to the final quarter of 2024, according to data from the Federal Statistical Office, “Destatis.” This figure is 0.1 percentage points higher than estimates provided by the financial platform Factset.
This marks a modest recovery for the German economy, which had contracted by 0.2% between October and December, and represents a “notably positive surprise” for economists.
Nonetheless, the current year is expected to present challenges for Europe’s largest economy, with spring forecasts from the Ministry of Economy indicating anticipated stagnation.
Estimates from the German central bank suggest that GDP may face another setback in the second quarter due to an “overall weak” economic environment. This situation could further deepen the ongoing industrial crisis in Germany, characterized by high energy prices and increased competition from Chinese rivals.
In a further setback for Berlin, the unemployment rate rose to 6.3% in April after three months of stability, as reported by the Federal Employment Agency on Wednesday. This represents a month-on-month increase of 0.1 percentage points, with March’s figure revised down from 6.3% to 6.2%.
