Financial News: German Economy Expands In Q4; Unemployment Remains Unchang

German Economy Expands In Q4; Unemployment Remains Unchanged

01/30/2026 - 05:34:00 (RTTNews)

(RTTNews) - The German economy logged a better-than-expected growth in the fourth quarter, driven by increased household and government spending and unemployment remained unchanged at the start of 2026, official data revealed Friday.

Gross domestic product grew 0.3 percent after remaining flat in the third quarter, flash data from Destatis showed. This was the first expansion in three quarters and exceeded the forecast of 0.2 percent.

On a yearly basis, GDP was up 0.4 percent compared to an expansion of 0.3 percent in the third quarter. Economists were expecting a steady growth of 0.3 percent in the fourth quarter.

Household and government consumption increased in the fourth quarter, Destatis said. Detailed results will be released only on February 25.

"The German economy thus ended 2025 in positive territory after a turbulent year, particularly for foreign trade," Destatis said.

The statistical office confirmed that the economy grew 0.2 percent in 2025. The protracted period of de facto stagnation seems to be coming to an end, ING economist Carsten Brzeski said. A cyclical rebound is clearly in the making but more is needed to improve potential growth, the economist noted.

Elsewhere, data from the Federal Employment Agency showed that the German unemployment rate remained stable at 6.3 percent in January, as expected.

The number of people out of work remained unchanged in January after an increase of 3,000 in December. Economists had forecast an increase of 4,000.

Federal Employment Agency chairwoman Andrea Nahles said unemployment increased significantly for seasonal reasons at the start of the year. Unemployment exceeded the 3 million mark again.

Based on the labor force survey results, Destatis reported that the unemployment rate held steady at adjusted 3.8 percent in December. The number of unemployed rose 7,000 to 1.68 million.

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