Growth was thus twice as high as penciled in by analysts, but failed to match the 0.7-percent jump quarter on quarter, logged in the January to March period.
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Europe’s largest economy expanded by 0.4% between April and June, down from 0.7% in the first quarter, but above forecasts of 0.2% growth. The seasonally adjusted annual GDP growth rate slid to 1.8% from 1.9%, above expectations for 1.4% growth. According to provisional results, exports were up, while imports were slightly down compared with the first quarter of 2016. The economy expanded 1.8 per cent from a year ago. Both household final consumption expenditure and government final consumption expenditure supported growth, too. “After a strong first quarter, a decline was recorded especially in gross fixed capital formation in machinery and equipment and in construction”. The traditionally export-heavy economy lately has been helped increasingly by domestic demand, with unemployment low.
Germany’s national inflation yardstick, the consumer price index, grew by 0.4%, the federal statistics office Destatis said.
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Consumer prices climbed 0.4% on both the month and the year in July on an European Union harmonised basis, the strongest reading since January 2016. Trends over the second half will be watched closely to assess whether there will be further acceleration based on very low interest rates or whether the United Kingdom referendum exit will trigger a slowdown in exports and undermine the wider outlook.
