Germany expected to grow 1.9% in 2013 because of Euro crisis
Germany's DIW economic research institute slashed its 2013 forecast for Europe's largest economy by 0.5 percentage points to 1.9% on Wednesday, saying the Euro zone debt crisis would have a bigger impact than it had originally expected.
The German Institute for Economic Research (DIW) said instability in Greece and Spain's weak banks were, along with austerity measures, limiting demand in crisis-stricken countries and taking a toll on German exports.
“The Euro zone crisis is causing the German economy to slow down much more than we originally expected,” the Berlin-based DIW said in a statement.
The institute maintained its 2012 growth forecast of 1%, saying private consumption would drive growth, helped by higher wage agreements and falling inflation, while exports would only make a moderate contribution to growth this year before picking up at the start of 2013.
The German economy experienced strong growth of 3.7% and 3% in 2010 and 2011 respectively, but DIW said growth to 2013 would be considerably weaker as the Euro crisis bites.
”On the one hand (the crisis) has a direct impact via trade flows because a lot of Germany's exports go to European countries which have been hard hit by austerity measures,“ DIW chief economist Ferdinand Fichtner said.
”On the other hand households are feeling increasingly uncertain again due to the crisis. That means they hold back on spending, while companies also hold back on investments, which depresses domestic demand,” he added.
The institute said the weaker growth dynamics would push Germany's unemployment rate up slightly to above 7% by the end of the year but added that it expected this to drop to around 6.5% in 2013 due to stronger growth.
DIW said the construction sector was a bright spot in the economy, especially due to favourable financing conditions.
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They can get all haughty and bash their southern neighbours for being lazy and imprudent, whilst acting all concerned for the Eurozone. At the same time enjoy record low interest rates and an exchange rate that allows them to export much more competitively than pre-crisis. Not to mention they have started to suck up all the unemployed brain power from Spain and Greece.
Germany will emerge from the crisis much bigger and the Euro zone much more subordinate.
Good on them, they deserve it.
Well modest but still good considering climate change. Ha ha
but having said that, some say, the pigs,, deserve what they get,
either way, the sooner we get out the better,
and then they can re-brand it,
germanys playground .
“getting rich on the backs of others is bad,”
May be for you mate. What kind of capitalist are you?
Ha ha
1.9% is a lot for an economy the size of Germany's. It is equivalent to about 15% of the Argie economy or 30% of the Chilean economy.
4 briton,
They are getting rich on the backs of their own hard work and astuteness.
so you are saying greece and spain and portugul and italy any cypus, are not to blame for there own demise, then
and germany should bail them all out,
read the blogg properly,
I didn't say anything about the PIIGS.
I just said:
”(Germany) are getting rich on the backs of their own hard work and astuteness”.
i.e. not off the backs of others, as you maintain @4.
i did not mention germany at all in context
exept the last bit, that stated germanys playground,
in which it surley is,
No, it says “Germany expected to grow 1.9% in 2013 because of Euro crisis”
- meaning ONLY 1.9% instead of the 3.7% in 2010 and 3% in 2011.
I too can read english, friend. I was referring to the title...
I miss him really, no often can you chat with the most powerful and rich mann on Earth.
Sure he is spending money like crazy and has not time to spend on poor like us.
ha ha
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