German Economy Grows 0.4% in Q1 on Export Surge Ahead of US Tariffs

Germany's economy grew by 0.4% in the first quarter of 2025, a revision from the earlier estimate of 0.2%, marking its fastest growth since late 2022. This stronger performance was largely driven by a surge in exports and manufacturing as U.S. companies stockpiled goods ahead of President Trump's planned tariffs, with exports to the U.S. reaching around $46.5 billion. Despite this boost, economists caution that the growth is partly due to one-off effects related to tariff anticipation and may not be sustainable in subsequent quarters. The German Council of Economic Experts still regards the economy as weak overall and expects flat growth for the year. However, some analysts see potential for continued growth driven by manufacturing and consumer strength supported by rising real wages. The development suggests that upcoming growth forecasts for Germany might be revised upwards, although a cautious outlook remains due to recent economic challenges.