German economy beats forecasts, heads for best year since 2011
Frankfurt, Germany - German growth steamed ahead in the third quarter, keeping Europe’s largest economy on track for its best year since 2011.
The 0.8 per cent jump in gross domestic product (GDP) was an acceleration from the previous three months and topped the 0.6 per cent median forecast in a Bloomberg survey. The expansion was driven by exports and capital investment, and net trade made a positive contribution.
The report confirms the Bundesbank’s prediction that the economy carried its strong growth momentum into the second half. That expansion is bolstering the euro area’s upturn and supporting the global outlook, though it also means Germany is potentially straining against its maximum capacity, with repercussions for inflationary pressures.
“You can feel the German economy is really humming along,” Holger Sandte, chief European analyst at Nordea Markets in Copenhagen, said before the release. “We are looking at a pretty robust picture so that raises the question: where is the speed limit?”
The euro strengthened after the release and traded 0.2 per cent higher on the day at $1.1688 at 8:27am in Frankfurt. The single currency also advanced against the pound.