German Growth Stagnates as Trump Trade War Starts to Bite

FRANKFURT — The German economy, which sets the tone for all of Europe, showed no growth at the end of 2018, the country’s statistics office announced on Thursday. Economists said one cause was United States tariffs, which have hit German steel makers.

The German economy is also experiencing collateral damage from the United States’ trade war with China. Tariffs on Chinese goods have contributed to a slowing of China’s economy, which in turn has hurt German carmakers and other companies that depend on Chinese sales.

The fourth-quarter data released on Thursday was worse than analysts’ projections for at least a little growth, but good enough to narrowly avert a recession. In the third quarter, German economic output shrank 0.2 percent compared with the previous quarter. Another quarter of declining output would have met one common definition of recession.

“The German economy is stuck in neutral,” Gregor Eder, an economist at the insurer Allianz said in a note to clients.