German Economy Expands 0.7% in Q4


The German economy grew a seasonally-adjusted 0.7 percent in the last quarter of 2014, compared with a 0.1 percent expansion in the July to September period and matching preliminary estimates. The expansion was driven by domestic demand, but net exports and investment also contributed.

Quarter-on-quarter, private consumption grew 0.8 percent and public spending rose 0.2 percent. Overall consumption contributed 0.6 percentage points to growth. Positive contributions were also made by foreign trade (0.2 percentage point) as increase in exports (1.3 percent) was higher than that of imports (+1.0 percent). Investment was up across the board with investment in construction growing the most (2.1 percent ), followed by machinery and equipment (+0.4 percent) and investment in other products (+0.2 percent).  Inventories were unchanged, subtracting 0.2 percentage points from the growth.

Year-on-year, the GDP expanded by 1.6 percent following a 1.2 percent expansion in the previous quarter. Household final consumption increased by 1.7 percent, while government expenditure was up 1.5 percent. Gross fixed capital formation in machinery and equipment rose a price-adjusted 2.4 percent and investment in construction was up by 1.8 percent, which was mainly due to increases observed for dwellings and public underground construction. Only the reduction of inventories slowed down GDP growth (–0.8 percentage points). Contributions to growth also came from foreign trade, which continued to be dynamic. In price-adjusted terms, exports of goods and services increased by 4.7 percent while imports increased 3.7 percent.

German Economy Expands 0.7% in Q4


Destatis l Rida Husna l rida@tradingeconomics.com
2/24/2015 11:19:51 AM