‘German growth to pick up in first quarter’

Frankfurt: Germany will see growth pick up in the first quarter of 2017, powered by industry and consumer spending, the country´s central bank said Monday.

"Powerful momentum can be expected from industrial activity above all," the Bundesbank wrote in its monthly report for February. An unexpected jump in industrial orders in December points to increased exports, while firms will need to invest more in production equipment to meet the fresh demand, the report said.

"German car manufacturers stand out" with the key industry taking on "considerably more" orders at home, from euro zone neighbours and from non-euro countries, the central bankers wrote.

Meanwhile, a positive mood among consumers, more people in work than at any time since Germany´s reunification in 1990, and higher wages all mean consumer spending will continue to support Europe´s largest economy.

The Bundesbank nevertheless noted that there were some clouds on the horizon, with business surveys suggesting a gloomier outlook for the coming months and increased inflation in the eurozone which could cut into consumers´ disposable income.