German Government Cuts 2013 Growth Forecast on Euro Woes

German Chancellor Angela Merkel’s government cut its growth forecast for Europe’s biggest economy as austerity policies in cash-strapped euro-region countries and cooling world trade damp exports.

German gross domestic product growth will slow to 0.4 percent this year from 0.7 percent in 2012, the Economy Ministry said in its annual report today. That compares with a previous forecast for 1 percent expansion. Growth will accelerate as the year progresses and average 1.6 percent in 2014, it said.