BERLIN (Reuters) – Germany’s strong fourth wave of coronavirus infections and the new Omicron variant https://www.reuters.com/world/asia-pacific/hong-kong-expands-travel-curbs-omicron-fears-australia-reports-5-cases-2021-11-30 are unlikely to tip its economy into recession although output will now reach its pre-pandemic level later than expected, leading economists told Reuters on Tuesday.

Monika Schnitzer was speaking at an event to celebrate the 50th Anniversary of Reuters’ German language news service. She said that while the economy is unlikely to regain pre-crisis levels in the first quarter 2022, she would advise government on economic policy.

Schnitzer suggested that this could be postponed to the second quarter.

This means that economic experts on the government’s economic advisory council will have to adjust their predictions slightly. The current forecasts of the largest European economy predict that it will grow 2.7% in 2018 and 4.6% by 2022.

Schnitzer claimed that she was not expecting the government to place a nationwide lockdown, including those who have been vaccinated. She also stated that it appeared unlikely that Omicron would stop the recovery from continuing and force the economy into recession.

Clemens Fuest (head of Germany’s Ifo economist institute) and Marcel Fratzscher (head of Germany’s DIWeconomic institute), both told the same Reuters panel that they did not anticipate the economy shrinking for at least two quarters consecutively over winter months.

I wouldn’t be surprised if there is a recession. Fuest stated that he expects a fourth-quarter stagnation and added that the economy will likely grow slower in 2022.

German household consumption was the main driver of weaker-than expected quarter-end economic growth of 1.7% between July and September. It more than offsets a decrease in investment by companies because of supply shortages in manufacturing.

Coronavirus infection in Germany is on the rise and threatens to end the country’s last pillar of economic growth. It weighs down consumer morale which in turn will impact business prospects for Christmas.