Europe's "motor" slows down

August 14, 2008

The German economy contracts in the second quarter of 2008, but by a less-than-expected 0.5 percent. This was the biggest decline in German GDP, often seen as the continent's economic "motor", since the first quarter of 2003. The high oil price, the euro's rise against the U.S. dollar and turbulence in the financial markets have all weighed on Europe's biggest economy. But Germany's Economy Minister brushed off suggestions that the country could slide into recession. Joanna Partridge reports for Reuters