
German Chancellor Angela Merkel (CDU), listens during the first session after summer Vacation of the German Parliament, or Bundestag, which debates the Federal Budget on September 10, 2019 in Berlin, Germany. (Michele Tantussi/Getty Images)
Editor's Note: This assessment is part of a series of analyses supporting Stratfor's upcoming 2019 Fourth-Quarter Forecast. These assessments are designed to provide more context and in-depth analysis on key developments over the next quarter. Europe's largest economy seems headed for its first recession in a decade. Recent data suggests that the German economy could contract again in the third quarter of 2019, after already contracting by 0.1 percent in the second quarter. According to the Munich-based Ifo institute, business sentiment in the country also reached a nearly seven-year low in August. And likewise, IHS Markit found that sentiment among Germany's manufacturing and service sectors, in particular, fell to its lowest level since 2013. Germany's dimming economic outlook is the result of several factors. Growing uncertainty fueled by the U.S.-China trade war and a potentially hard Brexit in October, for one, has taken a toll on the country's export-dependent economy.