Foreign trade drives German economic expansion in Q2: official data

Foreign trade, the traditional growth engine of German economy, regained its power in the second quarter of 2015 after being stalled for over a year, driving a moderate expansion of Europe's biggest economy, official data showed Tuesday.

Germany's gross domestic product (GDP) increased by 0.4 percent in the three months to June, following a slight quarterly growth of 0.3 percent at the start of the year, German federal statistical office Destatis said, confirming its preliminary calculations earlier this month.

"Positive contributions mainly came from the balance of exports and imports," it said. Exports rose by 2.2 percent compared with the first quarter of 2015, while imports increased by 0.8 percent.

"The balance of exports and imports contributed 0.7 percentage points to GDP growth and thus was its main driving force," Destatis added.

Domestic demand, however, showed mixed signals. While household consumption and government spending increased by 0.2 percent and 0.3 percent on the previous quarter respectively, investment declined by 0.4 percent.

Overall, domestic demand knocked 0.3 percentage points off the GDP growth.

Destatis also confirmed that compared with the same period of the previous year, the German economy grew by 1.6 percent in the second quarter, offering jobs to 42.8 million people, 0.4 percent higher than a year ago.

Earlier this month, the German Economy Ministry said the German economy was in "a solid upswing" thanks to a recovery of foreign trade and "a reliable support" from private consumption.

Germany's central bank forecast in its August monthly report "a rather strong economic growth" would continue in the second half of the current year. Endit