Germany Cuts 2012 Economic Growth Outlook as Crisis Dims Exports

The German government cut its forecast for economic expansion this year as the debt crisis dims the outlook for sustaining record exports, leaving domestic demand as the main motor for growth.

Europe’s biggest economy will grow 0.7 percent in 2012, less than the 1 percent estimated in October and just above the projected average for the euro-area, the Berlin-based Economy Ministry said today in its annual report. Economic growth, which reached 3 percent last year, will be weak in the first half before growing faster later in the year, it said.