Germany economy on track for 0.4% growth in Q4: DIW

27 November 2013 17:40  [Source: ICIS news]

LONDON (ICIS)--Germany’s economy is on a "hesitant upward trend", with GDP set to grow 0.4% in the fourth quarter of the year compared to the third, the country’s DIW economics institute said on Wednesday.

DIW economist Ferdinand Fichtner said that while German business sentiment was improving, the mood was better than new order intake and other underlying data suggested.

For the full year, DIW also forecast full-year GDP growth of 0.4% for Germany, as the weak start into 2013 remains a drag on full-year growth numbers.

Next year, the key German GDP growth drivers would be stronger domestic demand, in particular from construction and private consumption, Fichtner said. The country would also benefit from stronger exports, but export growth would be "less dynamic" than import growth, he said.

In related news, Germany’s KfW banking group on Wednesday forecast the country’s 2013 GDP growth at at "meagre 0.6%."

However, Germany was "stepping up a gear" and GDP should grow 2.0% in 2014, driven by residential construction, increased consumer confidence, as well as better European market trends, the bank said in an outlook report.

Germany's GDP growth in the fourth quarter of 2013 would come after 0.3% growth in the third quarter from the second, 0.7% growth in the second from the first, and no sequential growth in the first quarter.

Year over year, Germany's GDP was up 1.1% and 0.9% in the third and second quarters, respectively, but it was down 1.6% in the first quarter.

Paul Hodges studies key influences shaping the chemical industry in his Chemicals and the Economy Blog

By: Stefan Baumgarten
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