Business World

Tuesday 21 November 2017

Germany reports good economic growth

Europe's economic growth has exceeded expectations
Europe's economic growth has exceeded expectations

Germany set the bar for economic recovery in Europe on Friday as it reported a surprisingly strong growth rate of 2.2pc in the second quarter.

The rate of output is the fastest pace seen in Germany in two decades.

The main reason for the growth, which had been expected to remain below 2pc, was due to high demand for German exports, helped by a weaker euro.

The German economy shrank by 4.9pc in 2009 - its worst performance since the Second World War.

Destatis, the German Federal Statistical Office, said: "The recovery of the German economy, which lost momentum at the turn of 2009/2010 is really back on track."

Separate figures showed the French economy grew by 0.6pc in the quarter, compared with growth of 0.2pc in the first three months of the year, and the Spanish economy grew by 0.2pc in the second quarter, compared with growth of 0.1pc in the previous three months.

Carsten Brzeski, an economist with ING in Brussels, said the German economy, the largest in Europe, was in a "league of its own" and put the impressive growth down to "a catching up in the construction sector after the harsh winter and strong foreign demand for German goods".

The German government still has an official forecast for this year of 1.4pc growth but its economy minister Rainer Bruederle said expansion of "well over 2pc" was now possible.

Europe's economic recovery ground to a halt in 2009, with the 16-nation eurozone growing by just 0.1pc in the final quarter.

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