Aug. 12 (Bloomberg) -- The German economy probably expanded about 0.75 percent in the second quarter, according to a government estimate.
The Economy Ministry is predicting growth of about three-quarters of a percent, according to a person familiar with the forecast, who asked not to be identified because the projection is confidential. That exceeds the 0.6 percent median of 46 economist estimates compiled by Bloomberg. Germany’s Federal Statistics Office will release the data at 8 a.m. on Aug. 14.
Stronger-than-anticipated growth in Germany, Europe’s largest economy, may have lifted the 17-nation euro area out of its longest recession, confirming what European Central Bank President Mario Draghi described as “tentative” progress toward a “gradual recovery” later this year. Gross domestic product in the region may have risen 0.2 percent in the three months through June after shrinking for the previous six quarters, according to a separate survey.
“Stronger growth in Germany is a gift for its euro-area partners -- it signals the end of the region’s recession,” said Carsten Brzeski, senior economist at ING Groep NV in Brussels. “What we’ll see is a stabilization in the euro area but not yet a recovery, which we can be enthusiastic or cheerful about. It’ll be too slow to reduce unemployment and solve fiscal problems in distressed countries.”
Germany’s economy expanded “markedly” in the second quarter, driven by private consumption and industrial production, the Economy Ministry said on Aug. 9. The data bodes well for Chancellor Angela Merkel, who’s standing for a third term as German leader on Sept. 22.
German business confidence improved for a third month in July, and factory orders, industrial production and exports gained in June. Still, the economy is expected to slow in the current quarter, the Bundesbank said in its monthly report on July 22.
In June, the central bank lowered its growth projection for 2013 to 0.3 percent from 0.4 percent, and cut its 2014 outlook to 1.5 percent from 1.9 percent.
The ECB predicts the euro-region economy will shrink 0.6 percent this year, before expanding 1.1 percent in 2014.
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