German economy expands 0.4% in 1st quarter, above estimates

ISTANBUL

Germany's gross domestic product (GDP) grew 0.4% on a quarterly basis in the first quarter of 2025, official figures from Destatis showed Friday.

The figure exceeded the market forecasts and the Destatis' preliminary estimates of a 0.2% growth.

Exports of goods and services rose considerably by 3.2% compared with the previous quarter.

"In particular, significant growth was recorded for exports of pharmaceutical products and of motor vehicles, trailers and semi-trailers – both significant export goods for the US market," Destatis said.

"Anticipatory effects amid concerns over a brewing trade war with the US are therefore likely to have contributed to the positive development."

Meanwhile, imports of goods and services increased by 1.1%.

The household final consumption expenditure also made a positive impact on the GDP, rising by 0.5% quarter-on-quarter in the first three months of the year, mainly due to "the interim management of the budget of the Federation and of some Lander (states), which resulted, in particular, in a reduction in non-personnel expenditure by the government."

Economic performance was also up in both the construction industry (0.9%) and manufacturing (1%), following falls in the previous quarters.

On an annual basis, the country's economy was unchanged in the first quarter, defying forecasts of a 0.2% decline.