Germany’s gross domestic product rose 0.3% in the second quarter of 2026, the Federal Statistical Office (Destatis) reported on Tuesday, revising its initial estimate upward by 0.1 percentage points and confirming that the economy maintained growth momentum from the start of the year.
“The German economy is maintaining the growth momentum seen at the start of the year,” said Destatis President Ruth Brand. “As in the first quarter, growth was primarily driven by the positive development of exports.”
Exports surge as domestic demand lags
Foreign trade was the standout performer. Exports of goods and services jumped 2.0% quarter-on-quarter, with goods exports alone surging 2.6%. Service exports were flat. Year-on-year, exports grew 3.7%, led by a 5.0% increase in goods exports with strong gains in chemicals, data processing equipment, and electrical and optical products.
Consumer spending, by contrast, barely moved. Household consumption edged up just 0.1%, while government consumption also rose only 0.1%. The weakness underscores a persistent gap between Germany’s export-driven industrial engine and the spending power of its domestic economy.
Manufacturing shows first year-on-year gain since 2023
Manufacturing value added grew 0.9% quarter-on-quarter, led by chemicals and electrical equipment production. More significantly, manufacturing value added rose 1.1% year-on-year – the first annual increase since the first quarter of 2023, when the sector was emerging from the energy crisis that followed Russia’s invasion of Ukraine.
However, not all sectors shared in the recovery. Construction investment fell 1.5% year-on-year, dragged down by sharply higher prices and weak building completion work. Financial and insurance services declined 0.7% quarter-on-quarter.
Employment falls sharply
The headline growth figures masked continued weakness in the labour market. Some 45.7 million people were employed in the second quarter, a decline of 212,000 (-0.5%) compared with the same period a year earlier. Employment in services fell for the first time since the coronavirus crisis, while manufacturing and construction also shed jobs.
Average gross wages and salaries per employee rose 4.4% year-on-year, with net wages up 4.7%, but the savings ratio also edged higher as consumers remained cautious despite rising incomes.
Germany trails EU average
At 0.3%, Germany’s quarterly growth was below the EU average of 0.5%. Spain led major EU economies with 0.7% growth, while France and Italy each expanded 0.2%. The United States grew 0.4%. Year-on-year, Germany’s 1.0% expansion lagged the EU’s 1.2%.
discussion