In the second quarter of the year, Germany's real GDP dipped by 0.1 percent from the previous quarter, following a modest 0.2 percent rise in the first quarter. Year-over-year, the real GDP saw a 0.1 percent decline when adjusted for price and calendar effects.

The fall in real GDP growth was attributed to a fall in investments in equipment and construction. The earlier growth momentum from the first quarter has not been sustained, highlighting underlying vulnerabilities in the economy, particularly as it relates to new investments in the economy.

Despite the slight overall decrease in real GDP, this nuanced performance highlights the fragility of the economic recovery, underscoring the critical role of investment dynamics in shaping the broader economic landscape. As a result of the fall in the growth rate of economic activities, the RPI falls to minus 36, while the RPI-P falls to minus 51, indicating the German economy is performing well below market expectations, corroborating the weak economic growth in the second quarter of the year.

The flash estimate for second-quarter GDP is marginal expansion of 0.1 percent both on the quarter and on the year. These would compare with quarterly growth of 0.2 percent in the first quarter and yearly contraction of 0.2 percent.

Gross domestic product (GDP) is the broadest measure of aggregate economic activity and encompasses every sector of the economy. The provisional or flash estimate is normally released in the second week of the second month after the reference quarter. This is based on only limited data and provides just quarterly and annual growth rates and a limited qualitative guide to how the major output sectors performed.

GDP is the all-inclusive measure of economic activity. Investors need to closely track the economy because it usually dictates how investments will perform. Stock market Investors like to see healthy economic growth because robust business activity translates to higher corporate profits. The GDP report contains information which not only paints an image of the overall economy, but tells investors about important trends within the big picture. These data, which follow the international classification system (SNA93), are readily comparable to other industrialized countries. GDP components such as consumer spending, business and residential investment illuminate the economy's undercurrents, which can translate to investment opportunities and guidance in managing a portfolio.

Each financial market reacts differently to GDP data because of their focus. For example, equity market participants cheer healthy economic growth because it improves the corporate profit outlook while weak growth generally means anemic earnings. Equities generally drop on disappointing growth and climb on good growth prospects.

Bond or fixed income markets are contrarians. They prefer weak growth so that there is less of a chance of higher central bank interest rates and inflation. When GDP growth is poor or negative it indicates anaemic or negative economic activity. Bond prices will rise and interest rates will fall. When growth is positive and good, interest rates will be higher and bond prices lower. Currency traders prefer healthy growth and higher interest rates. Both lead to increased demand for a local currency. However, inflationary pressures put pressure on a currency regardless of growth.