German growth has
been on the receiving end of a well needed push as increased construction
figures led the continents biggest economy to its best quarterly rate in two
years.
However, the
potential British exit from the E.U. could throw caution to the wind as experts
reserve judgement on future economic performance until after June’s referendum.
A drop in interest
rates has also meant much higher consumer data, another welcome factor that has
spurred growth.
“Obviously if
consumers see no advantage to saving money then they will shop till they drop,”
said James Coleman, Managing Director and co-head of Portfolio Trading at
Softbank CIBC International. “Another factor we see was the large German
spending in aid of immigrants. That is going to have an effect on GDP growth
and construction data,” he added.
Coleman remains
cautious though. ”We can’t get carried away unfortunately. One thing that may
very well rock the boat is the Brexit vote coming up soon. We can’t be certain
which way this will go.”
Britons will take
to the polls on 23rd June to decide whether or not they wish to
remain in the European Union.
Super start
It’s been a
lightening start to 2016 and the growth forecast by Germany's
DIHK Chambers of Industry and Commerce has been raised to 1.6 percent from 1.2
percent previously.
DIHK boss Martin Wansleben exclaimed
recently “We are predicting a great year for the economy in general after the
construction and consumption data was analysed.”
Export data isn’t
quite as cheerful; with sagging foreign demand likely to be a drag on growth.
A surprise boost
to the economy came from the results of the refugee crisis. Government spending
is expected to reach a huge 10 billion euros in 2016, much of this being spent in
the construction sector on shelters for the homeless.
