German economy sees strong expansion in first quarter

Posted May 13, 2017

The French economy, the second-largest in the eurozone, grew 0.3% in the first quarter, slowing down from 0.5% in the final quarter of 2016, preliminary data showed.

As per Reuters polls, the GDP growth forecasts for the first 3 months of the year was in line with the consensus forecast.

It represented an acceleration over the second half of a year ago, when the economy had added just 0.2 per cent between July and September and 0.4 per cent between October and December. The growth pick up contrasts with a slowdown in the eurozone's second biggest economy France in Q1 and means Germany's GDP rate exceeded that of the United Kingdom and USA at the start of the year.

Looking ahead, Germany could surprise observers with even faster growth over the rest of the year, said analyst Florian Hense of Berenberg bank. It was the best quarterly growth rate in a year.

Berlin/Paris - There was good economic news from Germany and France on Friday.

High levels of employment, rising wages and low interest rates have all boosted consumer spending, while government spending has increased following the refugee influx of 2015-16, he said. "A chart topper on permanent repeat".

Destatis said in a separate publication that Germany's annual inflation rate, measured by harmonized European Union standards, rose to 2.0% in April from 1.5% in March.