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Germany’s economy contracted by 0.1% quarter-on-quarter in the second quarter of 2025, following a downwardly revised 0.3% expansion in the previous quarter, according to a preliminary estimate. The figure was in line with market expectations and marks the first quarterly contraction since Q2 2024. The decline was primarily driven by reduced investment in both equipment and construction. However, private and government consumption continued to grow, partially offsetting the overall slowdown. On an annual basis, GDP rose 0.4%, up from 0.3% in the first quarter.