Germany enters recession as energy prices soared after Ukraine war

Germany suffered its first recession since the start of pandemic, extinguishing hopes that Europe’s top economy could escape such a fate after the war in Ukraine sent energy prices soaring.

First-quarter output shrank 0.3% from the previous three months following a 0.5% drop between October and December, the statistics office said Thursday. Its initial estimate, last month, was for stagnation.

“The reluctance of households to buy was apparent in a variety of areas,” the office said in a statement. “Households spent less on food and beverages, clothing and footwear, and on furnishings.” They also purchased fewer electric cars as incentives were reduced.