Europe’s engine is stuttering. Germany officially fell into recession on Thursday, when official figures showed the economy contracted by 0.3 per cent in the first quarter of this year, the second consecutive quarterly decline. It’s the first time in nearly a decade that the EU’s largest economy is facing money problems, fueling tensions among its three coalition parties. The pro-business Free Democrats (FDP) and the Greens are increasingly at odds, with Chancellor Olaf Scholz’s Social Democrats caught in the middle, most recently over plans to phase out oil and gas heating in German homes, which the FDP has blocked. Dennis Rohde, the budgetary spokesperson for the Social Democrats, told Politico that negotiations for next year’s budget will be the “most difficult” in ten years.
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