Germany's economy has unexpectedly contracted in the second quarter of 2024, with the Gross Domestic Product (GDP) falling by 0.1% compared to the previous quarter, according to preliminary data from the Federal Statistical Office.

This decline follows a slight growth of 0.2% in the first quarter and highlights ongoing challenges such as weak investments in equipment and construction.

Economists had anticipated a modest growth of 0.1%.

The country is lagging behind other major Eurozone economies, with France and Spain reporting growths of 0.3% and 0.8%, respectively.

The outlook for the second half of the year remains bleak, as the Ifo business climate index has dropped for three consecutive months, indicating persistent economic difficulties.

Despite rising real wages and improved consumer sentiment, the overall economic recovery appears sluggish, with the government projecting only a 0.3% growth for 2024.