German economy, Europes largest, shrinks for second straight year

London (CNN) — Germany’s economy, the largest in Europe, contracted for the second year in a row in 2024, official data showed Wednesday, underscoring the challenges facing the region as it tries to get economic growth back on track.

Germany’s gross domestic product fell 0.2% last year, according to the country’s Federal Statistical Office, following a contraction of 0.3% in 2023.

It’s the first time since the early 2000s, when Germany was grappling with high unemployment, that the economy has shrunk for two years in a row, according to Carsten Brzeski, global head of macroeconomics at pan-European bank ING.

The data comes just weeks ahead of a crucial snap election, called after Germany’s governing coalition collapsed late last year over disagreements about how to bolster the country’s weak economy.

“Hope is that any new German government would decide on a longer-term plan for economic reforms and investments,” Brzeski wrote in a note.

The troubles facing the German economy are captured by the crisis …