Germany finds itself at a crossroads of global issues as it deals with an economic contraction, according to Peter Oppenheimer, chief global equity strategist and head of macro research EMEA at Goldman Sachs.
“The predicament that the economy is facing at the moment is really down to a number of factors,” Oppenheimer told CNBC Tuesday, with challenges in the manufacturing sector, a disappointing China reopening boost and higher energy costs contributing to the recession in Europe’s largest economy.
“It’s … not a deep recession but it’s obviously been more hit by obvious headwinds,” Oppenheimer said.
The comments reflect the latest projection by the Bundesbank, which estimated Monday that the German economy is likely to shrink this quarter thanks to slow private consumption and industry stuttering.
Bleak forecasts for the German economy have prompted discussion as to whether the country is once again the “sick man of Europe,” a moniker that was first used to describe Germany in 1998 as the country navigated the costly challenges of a post-reunification economy.
But there are positives to be found in the German economy, Oppenheimer told CNBC.
“The equity market has been holding up quite well and there are some bright spots, I think, in terms of activity in the economy,” he said, highlighting “opportunities” in Germany’s small and mid-sized companies, known as the Mittelstand.