According to first calculations of the Federal Statistical Office (Destatis), the price adjusted gross domestic product (GDP) was 0.3% lower in 2023 than in the previous year. After adjustment for calendar effects, the decline in economic performance amounted to 0.1%. “Overall economic development faltered in Germany in 2023 in an environment that continues to be marked by multiple crises”, said Ruth Brand at the Berlin press conference on Germany’s 2023 gross domestic product. “Despite recent price declines, prices remained high at all stages in the economic process and put a damper on economic growth. Unfavourable financing conditions due to rising interest rates and weaker domestic and foreign demand also took their toll. Therefore, the German economy did not continue its recovery from the sharp economic slump experienced in the pandemic year of 2020”.
German retail sales, exports, and industrial production all fell in 2023. Households were hit by a surge in the cost of living while the manufacturing sector suffered from high energy costs, weak global demand, and high interest rates.