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Home Economics

The Bundesbank has dispelled concerns about GDP growth

by Daniel Brown
2014/09/24
in Economics, HOME
2 min read
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The Bundesbank has dispelled concerns about GDP growth
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The Bundesbank has denied speculation about a sudden stop the upward trend in the German economy, but stressed that the positive data for July were due to one-off factors, says Wall Street Journal.

“The encouraging stats for July were a real surprise after the bad performance of the June – said in a monthly report of the German Central Bank. – This indicates that the fears of a sudden stop economic growth are unfounded.”

“Together c favorable business climate are signaled good situation on the labor market and the fact that consumers are not adjusted their expectations of revenues and planned expenditures, despite the reduction in the forecast for the economy”, – the report says.

“Along with this, a significant increase in the volume of industrial production in July, largely due to the many holidays, usually falling within the month, but this year dropped out in August,” – said the Bundesbank. This means that in August you can expect the opposite correction of this indicator.

German industrial production in July jumped by 1.9% compared with the previous month, showing a maximum 2-year growth rate, and far exceeding expectations.

Earlier, the German Institute for Economic Research (DIW) has lowered its forecast for economic growth in Germany in 2014 against the background of the general situation in Europe, according to Deutsche Welle.

According to the research institute ZEW index of investor and analyst expectations with regard to the German economy in the next six months (confidence index) fell this month to 6.9 points.

The Bundesbank expects growth in German GDP by 1.9% in 2014, 2% – in 2015 and by 1.8% – in 2016, Due to the fact that in the II quarter in Germany, there was a decrease of GDP, the result in the current year may be degraded.

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