Germany's economy grows in first quarter despite Ukraine crisis

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Germany's economy grows in first quarter despite Ukraine crisis

Pedestrians walk past barriers as construction for high-rise buildings is underway around Berlin's central Alexanderplatz on October 19, 2021. INA FASSBENDER AFP BERLIN -- The German economy grew in the first quarter, in line with expectations, despite the difficult economic conditions caused by the conflict in Ukraine and the Pandemic, according to data released on Wednesday.

Europe's largest economy was grew by 0.2 percent quarter-on-quarter and by 3.8 percent on the year, adjusted for price and calendar effects, according to the Federal Statistics Office. A Reuters poll had predicted growth of 0.2 percent and 3.7 percent.

Germany avoided a recession in the first quarter, defined as two quarters in a row of contraction, because gross domestic product fell by 0.3 percent at the end of 2021, as a result of the first-quarter growth.

The German economy started with little growth in the year 2022 despite the difficult global economic conditions, said Georg Thiel, president of the statistics office.

While household and government spending was mostly at the same level as in the previous quarter and exports were down at the beginning of the year, investments helped boost the economy.

ALSO read: Germany's COVID 19 jab panel: One shot enough for children.

Construction investments, boosted by mild weather, increased by 4.6 percent from the previous quarter, despite price increases and machinery and equipment investments, which saw a rise of 2.5 percent.

In its spring forecast, the German government said that it expects to see 2.2 percent of economic growth in the year 2022.