BERLIN (Reuters) - The German economy will continue to enjoy solid growth in the second quarter, driven by soaring private consumption and higher construction activity while net foreign trade is unlikely to add to the expansion, the Economy Ministry said in Thursday.
Europe’s biggest economy grew by 0.6 percent in the first quarter - faster than in the prior quarters - and analysts expect gross domestic product (GDP) to grow at least by the same rate in the April-June period.
“The German economy is continuing its accelerated upswing - in the second quarter too,” the ministry said in its monthly report.
“German exports are currently benefitting from a revival of world trade. But they are likely to grow less sharply in adjusted terms than imports, which are also heading upwards,” the ministry added.
This showed how the current account surplus was continuing its slow downward trend, which started in mid-2016, it said.
Industrial output has risen for five months in a row since the beginning of the year and sentiment indicators such as the closely watched Ifo index suggest that business morale has reached record highs, the ministry said.
“Consumer prices continue to rise significantly. Still, consumer spending keeps on increasing in real terms,” it said, adding that employment levels were rising, albeit at a slower pace.
Reporting by Michael Nienaber; Editing by Paul Carrel