BERLIN Oct 12 The German economy will lose some
steam in the second half of the year after its robust
performance in the first half, the Economy Ministry said on
Wednesday, putting a damper on growth hopes after
better-than-expected economic data.
"The economic upswing of the German economy is solid. But
growth is likely to slow a bit in the second half of the year
after the strong expansion in the first half," it said in its
A number of external risks is clouding Germany's foreign
trade outlook, including the uncertainty about the outcome of
Brexit negotiations between Britain and the remaining 27
European Union members on their future relationship, it said.
But domestic demand is expected to propel growth in Europe's
biggest economy. "Private consumption remains an important
pillar of support," the ministry said, adding that rising
employment, higher real wages and weak inflation were boosting
the purchasing power of consumers.
Construction is expected to rebound in the coming months
after its relatively weak output in August, giving the economy
an additional push in the second half of the year, it said.
The government last week lifted its 2016 growth forecast to
1.8 percent from 1.7 percent previously, which would be the
strongest expansion rate in half a decade. Leading economic
institutes are even predicting a growth rate of 1.9 percent.
For 2017, the government expects a slowdown in growth to 1.4
percent due to sluggish foreign demand. Adjusted for the number
of work days, the economic cooling is expected to be less severe
with a predicted growth rate of 1.6 percent in 2017.
(Reporting by Michael Nienaber; Editing by Joseph Nasr)