The motor of the European economy is revving up again.
Der Spiegel reports:
Germany just posted its strongest quarter of economic growth since reunification in 1990. During the second quarter, an exports boom, increased consumption and government stimulus helped the country chalk up growth of 2.2 percent. Buoyed by a surge in exports and continuing government stimulus programs, Germany’s economy is recovering at a faster pace than most economists expected. During the second quarter, gross domestic product increased by 2.2 percent on the previous quarter, the Federal Statistical Office in Wiesbaden announced on Friday, marking the largest quarterly economic growth since the country’s reunification in 1990.
There has been some criticism of the austerity package being introduced by the German government and of the ending of the stimulus packages. But perhaps the timing is right after all. But whether German growth can prevent a doubel-dip recession in the rest of Europe remains to be seen.
The 5 million unemployed in Germany in 2005 has now reduced and could soon be less than 3 million.
In addition to benefiting the labor market, the German economic stimulus program also boosted consumer spending. Short-time workers have more disposable income than the unemployed, and as a result, German consumers were hardly forced to cut back during the crisis.
Tags: double-dip, Economy, growth, recession
The k2p blog 
September 1, 2010 at 12:05 am
[…] which is looking ever more likely in Europe and the US – notwithstanding the recent growth in Germany and the […]