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Bundesbank lowers expectations for 2013

  |   Dec. 7, 2012 at 1:50 PM
BERLIN, Dec. 7 (UPI) -- Germany's central bank said Friday that the country's economy would teeter on the brink of a recession in 2013.

On top of a forecast of 0.4 percent growth for 2013, down from an earlier prediction of 1.6 percent, the Bundesbank said, "There are even indications that economic activity may fall in the final quarter of 2012 and the first quarter of 2013."

At least informally, the common definition of a recession is two consecutive quarters of economic contraction, which would put Germany in a recession at the end of March, CNN reported.

Germany has the European Union's largest economy and has taken a principle role in international efforts to rescue ailing eurozone allies, such as Greece, Ireland and Portugal.

However, German voters have also voiced concern over Germany paying the lion's share of international bailout efforts and this concern could rise if Germany's own economy begins to flounder.

In addition, the unemployment rate in Germany has been rising and the Bundesbank now predicts it will reach 7.2 percent in 2013, up from the current rate of 6.8 percent.

© 2012 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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