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German economy to grow 1.9 percent in 2015

Staff writer |
The German think tank Ifo institute forecast on Wednesday that German economy is going to grow by 1.9 percent in 2015 and 1.8 percent in 2016.

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Ifo researchers forecast an increase of 1.5 percent last December, and now they have upwardly revised their forecast to 1.9 percent.

"The German economy is currently experiencing a sharp upturn," said Timo Wollmershaeuser, head of Ifo's research team.

"Private consumption remains the key driver of the upswing, with private households enjoying a favorable income outlook due to the improved situation in the labour market," Wollmershaeuser added.

The labor force will increase from 42.6 million to 42.9 million this year and to 43.1 million in 2016. Therefore, the unemployment rate will fall over the period from 6.7 percent to 6.3 percent and 6.0 percent in 2016, according to the think tank.

Meanwhile, the inflation rate seems set to drop from 0.9 percent last year to 0.8 percent this year, and to rise to 1.6 percent in 2016.

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