IfW: The German economy is regaining momentum. According to the latest forecast by the Kiel Institute for the World Economy (IfW) GDP is to increase by 1.7 percent in 2015 and 1.9 percent in 2016 compared to 1.5 percent in 2014. Initially, the acceleration in economic growth will be driven in particular by private consumption thanks to a sharp increase in income and higher purchasing power as a result of a marked oil price decline.
In the course of time, investment spending will add to economic momentum on the back of favorable financing conditions and strong upward cyclical forces. German exports have experienced a robust trend, notwithstanding a challenging global environment. Furthermore, the terms of trade will also improve significantly as a result of lower oil prices in the year to come.
Employment growth will initially continue to decelerate. Low consumer price inflation is almost exclusively due to a strong fall in energy prices rather than deflationary trends, which are visible nowhere in Germany. (Quelle: ifw.de)