German economy recovering from 0.6% decline in Q4 – DIW

14 February 2013 14:29  [Source: ICIS news]

LONDON (ICIS)--Germany’s economy has already begun to recover from a 0.6% GDP decline in the 2012 fourth quarter from the third, an economics research institute said on Thursday.

DIW Berlin, which commented on official GDP data released earlier on Thursday, said that the country’s services sector was showing strength, and industrial orders and exports were picking up.

In addition, the eurozone debt crisis was weighing less heavily on companies than before, DIW said.

“Positive demand impulses from abroad, in particular from emerging economies, should prompt companies to take advantage of favourable financial terms and invest in equipment and machinery,” said DIW economist Ferdinand Fichtner.

As for the 2012 fourth quarter, the decline was primarily due to the eurozone crisis and declining European export markets, which began to create uncertainty in Germany’s domestic economy, Fichtner said.

However, the European Central Bank’s bond-buying programme had calmed markets and the uncertainty diminished, he added.

Earlier on Thursday, Germany’s federal statistics agency said that 2012 fourth quarter GDP fell by 0.6% from the third quarter – slightly higher then the 0.5% decline that had been expected.

The decline came after sequential growth of 0.5%, 0.3% and 0.2% in the first, second and third quarters, respectively.

Compared with the fourth quarter of 2011, GDP in the fourth quarter of 2012 was up 0.1% year on year. For the full 12 months of 2012, GDP was up 0.7%.

Germany's government has said it expects the country's GDP to grow by 0.4% in 2013. The country's chemical production is expected to rise by 1.5% this year.

By: Stefan Baumgarten
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