German economy gets euro boost to grows 0.4 percent in Q2

AP News
|
Posted: Aug 14, 2015 2:59 AM

BERLIN (AP) — The German economy picked up pace in the second quarter of the year, growing by 0.4 percent from the previous three-month period, official figures showed Friday.

Europe's biggest economy had grown by 0.3 percent in the first quarter. As a result, Germany's year-on-year growth increased to 1.6 percent from 1.2 percent.

Analysts said growth was driven largely by exports, a traditional strength of the German economy. These have been helped by the weak euro, which makes sales outside the common-currency area cheaper.

"The eurozone powerhouse has successfully defied external turbulences," Carsten Brzeski of ING Bank wrote in an analyst note, noting that the Greek crisis and the Chinese stock market collapse haven't had the negative impact on German growth some had feared.

"Record high employment, low inflation and decent wage growth remain strong trumps for the domestic economy and bode well for the second half of the year," he said.

However, Brzeski cautioned that China's recent slowdown could hurt German exports and growth.

Germany's quarterly growth rate has averaged 0.4 percent over the past year.