German economy accelerates

12th August 2004, Comments 0 comments

12 August 2004 , WIESBADEN - Spurred by strong exports, Germany's economy expanded by 0.5 percent in the second quarter compared to the first three months of 2004, officials reported Thursday. The Federal Statistics Office said that the rise meant year-on- year gross domestic product (GDP) growth in the second quarter was 2.0 percent. The growth rate was in line with economists' forecasts. However, after being adjusted for calendar effects - this year's second quarter had one working day more than last yea

12 August 2004

WIESBADEN - Spurred by strong exports, Germany's economy expanded by 0.5 percent in the second quarter compared to the first three months of 2004, officials reported Thursday.

The Federal Statistics Office said that the rise meant year-on- year gross domestic product (GDP) growth in the second quarter was 2.0 percent. The growth rate was in line with economists' forecasts. 

However, after being adjusted for calendar effects - this year's second quarter had one working day more than last year's - the annual rise was 1.5 percent, the office noted.

Following quarter-on-quarter growth of 0.4 percent in the three months to March, the expansion was the best Germany had managed since it scored 0.9 percent in first quarter 2001, official economists said. "It's a good sign," said an analyst at the Statistics Office.

In both quarters this year, the upturn was attributable to a rising trade surplus, with exports outstripping imports. Domestic consumption and public and business investment remain weak.

"The domestic economy still hasn't got its steam up," said Michael Heise, chief economist of Dresdner Bank. "This recovery still hasn't got the scale that we need."

German Economics Minister Wolfgang Clement said he was delighted at the figures, which suggested growth would be well inside the government's target range of 1.5 to 2.0 percent for 2004 rather than at the bottom limit of that corridor.

Most German economic research institutes have been tipping a full- year figure of 1.8 percent. In 2003, the German economy shrank by 0.1 percent in real terms.

The European Central Bank (ECB) meanwhile warned that oil prices above EUR 40 per barrel could undercut the eurozone recovery.

In its monthly report, the bank said the oil price was a "cause for concern".

DPA


Subject: German news
 

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