According to the German Federal Statistical Office (Destatis), in the final three months of 2022, the German economy contracted by 0.4% quarterly. The report, released Friday, showed the contraction came in larger than the estimate of a 0.2% fall.

Analysts attributed the worse than expected result to a mixture of the energy crisis, and persistently high inflation, which has weighed down household consumption and capital investment. According to the report, household spending fell 1.0% in the fourth quarter, as construction investment fell 2.9%, and machinery and equipment investment fell 3.6%.

Exports of German goods and services fell by 1.0% over the previous quarter off persistent supply chain issues and higher energy prices.

The report points to a risk of a technical recession, based off the weaker than expected readings, particularly given the fact this quarter may also be shown to have registered a contraction, according to analysts’ estimates. A technical recession is registered once a country has two consecutive quarters of negative growth.

A surge in energy prices last year, produced by the geopolitical upset from the Russian invasion of Ukraine, triggered record inflation in the German economy last year.

The inflation rate last month rose to 8.7% yearly and 1,0% monthly, according to the official data released Wednesday. Analysts have warned that as the nation commences refilling gas storage reserves for next winter in the coming months, absent the cheap Russian pipeline gas it had enjoyed in the past, the country may see a wave of price spikes throughout the nation.