Quarterly Report Germany IV/2016
German economy losing steam. Good performance in 2016 not at risk.
Despite a slowdown in the rate of growth during the course of the year, we still believe that our growth forecast of 1.9 percent for real GDP in Germany this year is realistic.
The German economy continued to grow, though at a slower pace. Third-quarter GDP increased by 0.2 percent over the previous quarter after inflation, seasonal and calendar adjustments. In comparison to the previous year, economic output rose by 1.7 percent after calendar adjustments, following 1.8 percent in the second quarter.
Towards the end of the year, the only factor still driving growth was the domestic economy. This trend is set to continue in the fourth quarter, making the growth contribution of consumption expenditure the key determinant of overall performance.
The healthy development in construction investments are the only factor contributing to growth in investment in noncurrent assets.
The trade balance is set to be slightly negative given the 2.5 percent increase in imports and stagnating exports throughout the year.