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German government lifts growth outlook despite global uncertainties

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Staff Writer | April 26, 2017
The German government raised its growth forecast for 2017 and 2018, with a robust jobs market and solid domestic demand helping to offset the impact on Europe's biggest economy of a slew of global uncertainties.
Brigitte Zypries
German economy   German Economic Affairs Minister Brigitte Zypries
The nation's economy should expand by 1.5% this year before accelerating to 1.6% in 2018, German Economic Affairs Minister Brigitte Zypries said, adding to optimism about the outlook for the nation's economy.

In January, Berlin had forecast a growth rate this year of 1.4% and 1.5% next year.

"The German economy is growing steadily and remains on a growth path, despite an uncertain global environment," Zypries said.

"The labour market's good performance position combined with a strong employment structure has helped to ensure a solid domestic economy," she said.

The government is also expecting a pickup in German exports and a modest gain in corporate investment.

While unemployment is forecast to continue to fall, the government expects companies to step up hiring, resulting in employment growing to 44.4 million by 2018, 2 million more than in 2013.

The government sees Germans as likely to enjoy further increases in their pay packets, consequently encouraging consumers to open up their wallets and spend.

Private consumption should expand by 1.4% this year and next, the report said, which was drawn up by both the economic affairs and finance ministries.

German exports are forecast to grow by 3.3% this year and 3.8% in 2018.