The government extended the official pandemic for 2 more months, effective from January 17th, 2021. We believe the extension of support measures to be a positive sign. The scheme for covering fixed costs has been extended till the end of March (1st quarter 2021) and it is very likely (not official yet) that the scheme for supporting the job market (temporary lay-offs) will be extended until April 2021. Value of construction works in Nov. 20 was up by 18.4%, far above our optimistic estimate (+1.0%) mostly due to warmer weather and low base effect (Nov. 2019 was seasonally adjusted weak). Though this came as a surprise, as the growth was so strong even after accounting for limitations on offering construction services to households. Growth was present mostly in civil engineering construction (roads, railways). Current account surplus in the first 11 months of 2020 stood at EUR 3.2 billion (7.6% of GDP), what was EUR 0.4 billion higher y-o-y. As goods imports fell more than exports, the goods surplus increased for EUR 1.1 billion whereas the services surplus decreased by EUR 0.7 billion, mostly due to reduced inflows from tourism.
According to the first estimates of the Federal Statistical Office (Destatis), the German real GDP was 5.0% lower in 2020 than in the previous year. The overall economic downturn was less serious in 2020 than in 2009 (-5.7%) and above the previous estimates of the European Commission (-5.6% in Nov. 2020). Higher number of working days in 2020 cushioned the drop by 0.3 p.p. Value added in manufacturing dropped by 10.4%, trade, transport, accommodation and food services by 6.3%. Only the construction sector weathered the COVID-19 crisis better: its gross value added increased by 1.4 y-o-y.