05,August,2018

Economic experts raise growth forecast

Economic experts raise growth forecast

Germany's leading economic institutes expect the economy in Europe's powerhouse to expand slightly more than previously forecast. At the same time, experts warned of some trailing off in the mid-term.


In their Spring Joint Economic Forecast published on Thursday, Germany's leading economic research institutes said the EU's largest economy would grow by 2.2 percent this year and by 2.0 percent in 2019, versus 2.0 percent and 1.8 percent respectively as predicted in the fall of last year.


"The German economy is still booming, but the air is getting thinner as unused capacities are shrinking," said the head of Economic Forecasting at the Munich-based ifo institute, Timo Wollmershäuser.


He warned Germany's new government against a massive public spending spree despite the budget surplus at hand.


"It's precisely when the government's coffers are full that fiscal policy should reflect the implications of its actions for overall economic stability and the sustainability of public finances," he said.


"The extension of statutory pension benefits outlined in the coalition agreement runs counter to the idea of sustainability."

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