THE GERMAN economy is likely to have grown in the third quarter despite a weak global backdrop, thanks to a strong performance by German industry and robust exports to areas outside the Eurozone.
In its monthly report, the country’s Finance Ministry wrote today: “Expansion in German industrial production...likely gave significant growth impetus. Most analysts did not expect this given the deterioration in the business mood.”
Many economists had forecast the economy would contract in the third quarter, particularly as Germany’s closely-watched Ifo business sentiment index worsened for five months in succession.
“All in all, German exports continue to appear robust despite a slow-down in global momentum... Stimulus for the export market came above all from non-Eurozone countries,” the report said.
German growth slowed to 0.3 per cent in the second quarter from 0.5 per cent in the first as firms postponed investments due to concerns about the 17-nation bloc’s troubles.
The Finance Ministry said in the fourth quarter of 2012 there could be a significant weakening in economic activity, due to the depressed business climate in other Eurozone states, but the German economy would pick up gradually during 2013.
City A.M. Reporter