ING economist Carsten Brzeski said Germany's woes were partly due to the rise in part-time work.
“Despite the generally strong labor market, there is collective concern in Germany about a potential loss of prosperity and a decline in competitiveness,” he said.
“Employment in Germany may be at a record high level, but the number of part-time workers has also recently increased to a historic high. Total working hours compared to 62.3 billion hours in 2019. However, per capita labor productivity remains slightly below pre-pandemic levels.
Italy's economy grew by 0.3%, while Spain's tourism boom continued, with GDP increasing by 0.7% for the second consecutive quarter.
Spain's production increased by 2.4% year-on-year, while the euro area's overall year-on-year growth rate was just 0.4%, and Germany's production fell by 0.2%.
Klaus Vystesen of Pantheon Macroeconomics said the main hope lies in subduing inflation, which should ease the strain on household and business finances and allow interest rates to fall.
He added: “Lower inflation is currently boosting real income growth, leaving room for consumer spending to recover even as savings rates rise further as interest rates are expected to remain high. “
“Rising interest rates remain a drag on investment, but this should gradually fade in the second half of the year, especially if we are correct that the European Central Bank has room to lower policy rates slightly. .”
