German economy expands on investment drive

Cornelia Mascio
Novembre 14, 2017

Gross domestic product-the broadest measure of goods and services produced in an economy-grew at an annualized rate of 3.3%, compared with 2.6% in the second quarter, the Federal Statistical Office, Destatis, said Tuesday.

On Monday, Poland's central bank revised upwards its GDP growth forecast for the country, saying it expected the economy to expand 4.2% this year as a whole.

The German economy moved up a gear in the third quarter, underpinned by a pickup in global demand and higher corporate investment.

This was stronger than the consensus forecast of 0.6 percent and marked an increase from the 0.6 percent logged in the previous quarter.

The German government's Council of Economic Advisers last week raised its economic growth forecasts for 2017 to 2.0% from an earlier estimate of 1.4%.

Chancellor Angela Merkel and her conservative allies are locked in talks with the liberal Free Democrats and the left-leaning Greens to forge an untested three-way coalition after September's inconclusive election.

In the third-quarter data release, Destatis pointed to the "positive contributions.from foreign trade" as exports outpaced imports.

Robust government and consumer spending "remained rather stable" in the third quarter, it added, while noting that investments had increased, particularly "in machinery and equipment".

Gross domestic product accelerated to 2.8% in the third quarter when compared with the same period a year ago - up from 2.3% in the three months ended June, according to Tuesday's data.

Over the previous year the German economy has grown by 2.8 per cent, while Italy and Portugal both also contributed to the broader Eurozone economy, both growing by 0.5 per cent in the third quarter.

For 2018, it is pencilling in growth of 1.9 percent.

Economic activity in Europe's largest economy has been brisk and its jobs market buoyant, despite a stronger euro eroding the price-competitiveness of German exports, geopolitical tensions and the threat of heightened trade protectionism.

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