Bun­des­bank still con­fi­dent Ger­many can re­turn to growth

The Pak Banker - - FRONT PAGE -

Ger­many, Europe's big­gest econ­omy, has got­ten off to a some­what shaky start to 2013, but that will not jeop­ar­dise its ex­pected re­cov­ery later this year, the Bun­des­bank said on Mon­day. "The hes­i­tant start to 2013 has not placed a ques­tion­mark over the an­tic­i­pated re­bound in eco­nomic ac­tiv­ity," the Ger­man cen­tral bank wrote in its March monthly report.

Af­ter Ger­man gross domestic prod­uct (GDP) shrank by 0.6 per­cent in the last quar­ter of 2012, in­dus­trial or­ders and out­put data for Jan­uary de­clined un­ex­pect­edly, deal­ing a blow to hopes for a rapid re­bound.

Nev­er­the­less, con­fi­dence and sen­ti­ment in­di­ca­tors are con­tin­u­ing to point up­wards. The im­por­tant Ifo busi­ness cli­mate in­dex, for ex­am­ple, "rose again in Fe­bru­ary, with ex­port ex­pec­ta­tions in par­tic­u­lar point­ing up­wards," the Bun­des­bank wrote. "Out­put ex­pec­ta­tions are sim­i­larly point­ing to ex­pan­sion. This is backed up by a strong rise in im­ports in Jan­uary, fol­low­ing two un­usu­ally weak months.

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