Consumption drives German growth

Buoyant private consumption, exports and investment powered German growth of 0

Buoyant private consumption, exports and investment powered German growth of 0.6 per cent in the third quarter, data showed this morning.

It was the seventh consecutive quarter of expansion, and economists said the figures underscored how the export-led upswing economy had broadened to include the domestic economy.

The robust state of the economy reinforced the view that Germany was well placed to absorb the impact of a three-point rise in sales tax at the start of next year.

A breakdown of the data from the Federal Statistics Office showed private consumption and net trade each contributed 0.4 percentage points to GDP growth in the quarter. Investment in plant and equipment and construction each added a tenth of a point.

READ MORE

Government consumption contributed 0.2 points, while inventories subtracted 0.5 points.

Exports surged 4.2 per cent over the quarter, on a seasonally adjusted basis, outpacing a 3.6 per cent gain in imports. Private consumption rose 0.7 per cent and state spending 0.9 per cent.