German economic growth will accelerate significantly in the last quarter, according to estimates of the German Central Bank Bundesbank. Moreover, the inflation, suppressed for years, could exceed 1% in December due to more expensive oil.
The GDP growth, which was weak through most of the second and third quarter, is likely to accelerate due to the good performance of the industrial production, stable construction and strong consumer spending, supported by optimistic attitudes, according to the regulator.
Good forecasts of the central bank are similar to those of the Institute for Economic Research (Ifo) last week. According to them, the German economy has bounced off the bottom by mid-year, when weak demand for production for export and uncertainty after the British referendum heavy expansion.
“The extremely large increase in new orders along with favorable corporate attitudes is expected to stimulate industrial activity in the fourth quarter”, says the report of Bundesbank. “Household consumption is also an important pillar of the economy and this is reflected in the sharp increase in retail sales in October”, adds the text.
The inflation, which was one of the biggest headaches for the European Central Bank (ECB) years, will probably exceed 1% in December, reaching the highest level since April 2014.
Nearly four years the inflation is below the 2% target level of the ECB despite unprecedented stimulus to promote growth and consumer prices.
The European Brent oil rose by 14% last month and by 49% since the beginning of the year, which supports the recovery in inflation.
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