Germany cuts economic growth forecasts

Berlin, Germany (AHN) – The German government cut its forecast for economic output in 2012 to 0.7 percent from its October estimate of 1.0 percent, while predicting growth of 1.6 percent for 2013.

Despite the slower growth forecast, Economy Minister Philipp Roesler said that he did not see a recession ahead for the nation. Roesler insisted that Germany would remain an “anchor for stability and growth in Europe.”

Export-driven Germany is Europe’s top economy, but it hasn’t been immune from the effects of the ongoing eurozone crisis or from weaker demand for its exports from emerging markets.

Roesler said the economy probably shrank by 0.3 percent in the last quarter of 2011, but he expects growth of 0.1 percent in the first quarter of this year.

That moderate growth would save Germany from officially sliding into recession, which is defined as two consecutive quarters of negative growth.

Roesler said that the earlier projections had been based on a quick solution to the eurozone debt crisis and relaxed market tensions, neither of which happened.

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