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Government support for German companies in the corona crisis
Jan SchildbachSebastian Becker
Fighting the corona crisis: Whatever it takes.
Fighting the corona crisis: Whatever it takes. The government’s support measures so far include greater access for firms to short-time allowance, tax moratorium and the potential provision of state guarantees of up to EUR 460 bn. We expect the government to come up with additional fiscal stimulus measures soon. The budget balance could post a deficit of 3.5% of GDP in 2020/21. (Also in this issue: KfW programmes to support corporate Germany – A primer. Corporate lending in a corona recession: Development banks as an anchor of stability?) [more]
After a good start into 2014, manufacturing output in Germany looks set to grow by 4% in real terms in the full year. Even though business expectations have recently weakened somewhat, they remain in positive territory. [more]
Given the continued strong employment build-up and wage increases as well as slight increase in hours worked disposable income should grow by 2.5% even though monetary social benefits and income from self-employment and from investment are expected to rise only at a sub-par rate. [more]
The details of the 0.4% qoq GDP increase released this week have not altered our GDP forecast of 1.5% for 2014. If anything, they have added to our suspicion that current surveys (corporate and consumer) might paint a too rosy picture. [more]
We see economic growth in the order of 1.5% this year. Continuously strong private consumption and a rise in investment in machinery and equipment for the first time in two years are expected to lay the foundation for this solid performance. [more]
The coalition intends to hugely increase pension benefits, introduce a minimum wage and increase public spending. There is as little provision for tax hikes (SPD campaign issues) as for tax relief (CDU and CSU pledges). [more]
We have lifted our forecast for 2013 GDP growth in Germany from 0.1% to 0.5%. This is not based on a more bullish assessment of H2's growth dynamics, though. Our call results instead from the growth surge due to one-off effects in Q2 (0. [more]
In this issue we look at two structural aspects of the German economy which provide speed limiters for GDP growth. The first is the interplay of foreign and domestic demand with implications for the current cyclical forecast. [more]