Tuesday, August 24, 2010

Economy powers ahead with strongest growth since reunification

The German economy grew by 2.2 percent in the second quarter from the previous three-month period, final figures showed Tuesday. It could even expand by a record 3.4 percent for the full year, a business federation has forecast.

The National Statistics Office (Destatis) confirmed its previous estimate for Europe's biggest economy, which also showed 12-month growth 4.1 percent.

The quarterly growth rate was the strongest since East and West Germany were reunified in late 1990.

Growth in Germany contrasts with a loss of momentum in the United States, the world's biggest economy, and a slowdown in number two China.

Robust activity has continued into the third quarter meanwhile, though at a lighter pace, and is expected to remain on an upward path through the end of the year.

In October, the federal government is to revise its previous 2010 forecast of 1.4 percent growth, officials have indicated.

The German Chamber of Commerce and Industry (DIHK) now expects the country's economy to grow by 3.4 percent this year, its chief Martin Wansleben said Monday.

"The recovery is expanding," Wansleben told news magazine Der Spiegel.

Businesses are investing again and "even consumption is accelerating thanks to favourable developments in the labour market," he added.

The forecast is considerably higher than the revised 3.0 percent forecast issued on Thursday by the German central bank, and would see the economy tie the growth record it set in 2006.

Germany suffered its worst post-war recession last year, but has bounced back with the help of strong foreign demand for its high quality automobiles, chemical products and machine tools.

Source: http://www.thelocal.de/national/20100824-29355.html


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