26 Mar 2015
German economic outlook is bullish - ING
FXStreet (Guatemala) - Analysts at ING Bank explained, like a sailboat, the German economy only needs to hoist the sail and lean back and relax.
Key Quotes:
"Stormy tailwinds could usher in the strongest economic performance since 2011. The German economy ended a volatile year on a very strong note. With GDP growth of 0.7% QoQ in 4Q14, the economy proved that the summer weakness was only a soft spell, driven by one-offs like vacation and public holidays, rather than a drastic structural change."
"Looking ahead, the economy looks set to continue surfing on a wave of economic wellbeing.
"Particularly the domestic segment of the economy continues to be a source of happiness."
"The labour market is likely to continue moving along the line of its current natural rate of unemployment of c.5.5% (or 6.5% according to the national definition)."
"The implementation of the minimum wage, another year with wage increases of c.3% YoY and low energy prices should also increase German consumers’ purchasing power. Last but not least, the ECB’s QE has started to feed into the domestic economy, with consumers’ willingness to save at all-time lows. In all, private consumption looks set to become an even more important growth driver than in recent years."
Key Quotes:
"Stormy tailwinds could usher in the strongest economic performance since 2011. The German economy ended a volatile year on a very strong note. With GDP growth of 0.7% QoQ in 4Q14, the economy proved that the summer weakness was only a soft spell, driven by one-offs like vacation and public holidays, rather than a drastic structural change."
"Looking ahead, the economy looks set to continue surfing on a wave of economic wellbeing.
"Particularly the domestic segment of the economy continues to be a source of happiness."
"The labour market is likely to continue moving along the line of its current natural rate of unemployment of c.5.5% (or 6.5% according to the national definition)."
"The implementation of the minimum wage, another year with wage increases of c.3% YoY and low energy prices should also increase German consumers’ purchasing power. Last but not least, the ECB’s QE has started to feed into the domestic economy, with consumers’ willingness to save at all-time lows. In all, private consumption looks set to become an even more important growth driver than in recent years."