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SHANGHAI, CHINA, February 06, 2018 /24-7PressRelease/ -- The German government has upwardly revised its growth predictions for this year from 1.9 percent to 2.4 percent.
Analysts at Shanghai, China based investment house Ashton Whiteley say the change in forecast comes in the wake of a series of promising economic figures that indicated the German economy is still operating at full steam after posting its strongest growth rate in 6 years last year.
The positive economic sentiment is in strong contrast with the political uncertainty currently plaguing Germany as Chancellor Angela Merkel battles to finalize a coalition agreement with the Social Democrats some 4 months after a federal election.
An Ashton Whiteley economist stated that the government anticipates that exports to increase by 5.3 percent in 2018 and imports to grow by 5.8 percent.
Employment is expected to increase by 490,000 to hit a record high of approximately 44.8 million people in 2018, while joblessness is forecast as dropping to 5.3 percent from 5.7 percent last year.
The better-than-projected growth rate and declining rate of unemployment will probably improve the state's overall tax income, further increasing an already elevated budget surplus and generating more fiscal flexibility to increase state spending and reduce taxes.
Acting German Economy Minister Brigitte Zypries, a senior member of the Social Democrats, will announce the outgoing government's revised growth predictions during a press briefing next week.
A coalition of the Social Democrats and Merkel's conservatives have governed Germany for 4 years and the parties are now attempting to renew their alliance for another 4 year term.
Ashton Whiteley economists say domestic spending has become the primary contributor to German economic growth as consumers profit from the record-high rate of employment, increasing salaries, strong job security, increasing salaries and low lending costs.
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