The Bundesbank said the German economy, Europe’s largest, probably expanded moderately in the second quarter as construction and services growth offset weaker industrial production.
“According to available indicators, the German economy should have grown at a moderate pace in the spring,” the Frankfurt-based Bundesbank said in its monthly report today. “The outlook for further economic developments is subject to high uncertainty.”
Germany’s economy expanded 0.5 percent in the first quarter after contracting 0.2 percent in the final three months of 2011. Since then, unemployment has risen and confidence among investors and executives has dropped amid slower global growth and an intensification of the sovereign debt crisis in the euro region, Germany’s largest export market.
While industrial production probably declined in the second quarter from the first, construction activity and services output expanded, according to the report. Furthermore, “German exporters were able to increase deliveries abroad despite continued economic difficulties in the euro area and the global braking,” the Bundesbank said.
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