Germany has narrowly avoided sliding into recession after interest rate cuts prompted more spending across the eurozone.

German GDP grew by 0.2pc in the three months to September, partially bouncing back from a 0.3pc slump suffered in the previous quarter.

The outcome will come as a relief for Olaf Scholz, the Chancellor. The eurozone’s largest economy had widely been expected to slump into a recession, which is defined as two back-to-back quarters of declining economic activity.

While Germany avoided a technical recession, the economy is still stagnating. GDP growth has been near zero for the past two years.

Carsten Brzeski, economist at ING, said there was little prospect of any immediate improvement for the German economy, which “remains barely larger than it was at the start of the pandemic”.