Will Germany experience a recession in 2023?
I will resolve YES if the German economy, measured by price + calendar + seasonally adjusted GDP growth, experiences negative economic growth for two consecutive quarters in 2023.
I will use data from the official German statistics agency. See the (EDIT: second) line of the table here: https://www.destatis.de/DE/Themen/Wirtschaft/Volkswirtschaftliche-Gesamtrechnungen-Inlandsprodukt/Tabellen/bip-bubbles.html
"preisbereinigtes BIP" means price-adjusted GDP
If the website no longer exists at the beginning of 2024, I will find a suitable alternative data source.
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Once data for Q4 comes out, the numbers for Q3 might also be adjusted. I will resolve this to YES if both the numbers for Q3 and Q4 are negative (or for some reason, they e.g. adjust Q2 numbers to be negative so that Q2 and Q3 are both negative even if Q4 is positive). Are people fine with that?
There is just some chance that the numbers might be adjusted again, e.g. when Q1 2024 data comes out and might change the outcome of this market but I don't want to wait that long to resolve. Anyone disagree?
@SirCryptomind Mhm I think I won't resolve yet but wait for quarterly data to come out.
The current estimate of a 78% probability for a GDP contraction in Q4 2023 might be deemed conservative, given that the annual forecast for Germany's economy necessitates a 0.3% decline in this quarter to align with the expected annual shrinkage of 0.3%. My advise: vote „yes“ as long as this probability is still undervalued :) (disclaimer: I also voted “yes”)
@MaxG i think you should change the line "the first line on the lable here" which for me implies the first row. i got a bit confused there.
Compared to the version published on August 25 (as preserved by the Internet Archive here: https://web.archive.org/web/20230907112519/https://www.destatis.de/DE/Themen/Wirtschaft/Volkswirtschaftliche-Gesamtrechnungen-Inlandsprodukt/Tabellen/bip-bubbles.html )
Q1 was adjusted from -0.1% to 0.0%
Q2 was adjusted from 0.0% to +0.1%
(and the lines for per-capita and per-worker figures are completely gone)
So it's also a bet that by the time the Q4 figures are released, Q3 won't be adjusted to 0.0%.
Several indicators suggest that Germany is on the verge of experiencing a decline in economic growth for the rest of 2023:
· The Federal Statistical Office (Destatis) reports that GDP growth has sharply slowed down to 0.4% in the second quarter of 2023: a significant drop from the 2.7% growth recorded in the previous quarter.
· Eurostat's GDP overview and the European Commission's economic forecast for Germany align with this trend, underlining a contraction in key economic sectors - with manufacturing output declining by 1.2% and services by 0.8% - and predicting a meager 0.2% GDP growth for the entire year.
· Despite Germany's attempt to stimulate the economy through corporate tax cuts, as reported by Deutsche Welle (DW), various economic experts yet express concerns.
· Even the International Monetary Fund (IMF) acknowledges the challenges in the German economy and forecasts the 2023 Projected Real GDP (% Change) as -0.5%.
With the German economy experiencing stagnation in the 2nd quarter of 2023, the cumulative evidence suggests a sustained period of possibly negative economic growth in 2023.
https://www.dw.com/en/germany-european-commission-cuts-2023-growth-forecast/a-66776816
This should resolve to YES, right?
@habakuk Only one of those quarters is in 2023. We'll need to wait at least for the second-quarter figures. (And since DESTATIS has demonstrated that they'll apply corrections afterwards, the first numbers released for the second quarter won't necessarily remain unchanged until 2024.)
Oh, yes. I see. Obviously I was too fast. But I guess it‘s still reasonable to update (a bit).
… I should have traded on the other market.
https://manifold.markets/jonjordanc3f0/will-the-german-economy-enter-a-rec?r=aGFiYWt1aw
This is looking increasingly unlikely. The official numbers for Q1 were stagnation (0.0% growth), and almost all the recent forecasts for the whole of 2023 I have seen are projecting slight growth.
Q1 numbers: https://www.destatis.de/DE/Presse/Pressemitteilungen/2023/04/PD23_169_811.html#:~:text=Data%20ranges%20from%2083.53%20to%20108.68.&text=End%20of%20interactive%20chart.&text=Im%20Vorjahresvergleich%20war%20das%20BIP,als%20im%201.%20Quartal%202022.
Recent forecasts: https://www.tagesschau.de/wirtschaft/konjunktur/konjunkturprognose-ts-112.html
New forecast released by the German ministry of economics predicts slight growth in 2023, instead of a recession: https://www.tagesschau.de/wirtschaft/konjunktur/wirtschaftspolitik-perspektive-jahreswirtschaftsbericht-habeck-103.html
Still, growth is projected to be 0.2%, which leaves plenty of room for negative quarters.