Scholz Inherits Bruised German Economy With Outlook Souring

Olaf Scholz is about to become chancellor of an unhealthier German economy than the one he looked set to inherit when his party won elections in late September.

Olaf Scholz, Germany's incoming chancellor, in Berlin on Dec. 6, 2021. Foto: Bloomberg photo by Liesa Johannssen-Koppitz.

With the Social Democrat leader poised to be sworn in as Angela Merkel's successor on Wednesday, growth prospects have soured in the weeks it took to negotiate a three-way coalition with the Greens and the Free Democrats.

Data on Monday underscored the deterioration in Europe's biggest economy, showing a slump in factory orders that was far worse than any analyst predicted as foreign demand plunged. That followed last week's revelation of a once-in-a-generation cost-of-living squeeze for German consumers as inflation topped all estimates to reach 6% -- the highest since the early 1990s...

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