Germany’s economic growth in the second quarter was driven by consumption and a rebound in investment as a recovery in the 17-nation euro area, its biggest trading partner, bolstered confidence.
Investment in plant and machinery climbed 0.9 percent in the second quarter, the first increase since 2011, today’s report showed. Construction output surged 2.6 percent. Household spending gained 0.5 percent and government consumption was up 0.6 percent. Domestic demand added 0.5 percentage point to growth, while net trade contributed 0.2 percentage point. Exports rose 2.2 percent and imports advanced 2 percent.
Manufacturing growth, record exports, looser bank lending and a housing recovery are raising the odds that the U.S. economy, the world’s largest, will accelerate after GDP rose at a 1.7 percent annualized rate in the second quarter. The Chinese economy, the second-biggest, may be strengthening after a two-quarter slowdown. A gauge of the nation’s factory output this month showed a return to growth after the biggest decline in more than a year.
“Global demand is advancing and if the domestic economies in struggling euro counties stabilize further, we will embark on a stable growth path,” said Alexander Koch, an economist at UniCredit Group in Munich. “We’ve already seen a recovery in German exports, which should continue in the coming months, and domestic consumption isn’t doing too bad either.”
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