German Growth Accelerates In Second Quarter

Germany has bounced back from an early 2018 slowdown, official data showed Tuesday, as the pace of growth accelerated despite the rumblings of a trade war that could trip up its export-led economy.

Frankfurt am Main, (APP - UrduPoint / Pakistan Point News - 14th Aug, 2018 ) :Germany has bounced back from an early 2018 slowdown, official data showed Tuesday, as the pace of growth accelerated despite the rumblings of a trade war that could trip up its export-led economy.

Growth rebounded from its first-quarter slide to reach 0.5 percent quarter-on-quarter between April and June, according to preliminary data from Federal statistics authority Destatis.

Analysts surveyed by data company Factset had predicted expansion would remain at the pace seen between January and March, when growth slowed to 0.4 percent.

"Contrary to the national soccer team, the German economy did not have a rude awakening at the start of the summer," ING Diba bank analyst Carsten Brzeski said.

The figures showed Europe's largest economy had grown 2.0 percent year-on-year by the end of the second quarter, a result likely to comfort observers who had feared a slowdown throughout 2018 after the weaker first three months.

Germany also outperformed the average of the 19-nation eurozone, whose growth slowed to 0.3 percent between April and June.

Other major economies Italy and France reported below-average expansion.

Growth was lifted by "positive domestic impulses", Destatis said, with increased spending on consumption by both households and the state.

A major driver of domestic consumption has been the steady decline in unemployment, with monthly official figures regularly announcing new lows not seen since Germany's 1990 reunification.

Workers in some flagship sectors like metalworking have also begun driving harder wage bargains this year, hinting at an end to the long moderation in salaries that followed the financial crisis.

Investments in equipment and construction, helped along by low interest rates, also swelled in the second three months.

But imports grew faster than exports against a background of trade tensions.