A surge in investment propelled German economic growth to its fastest pace in two years in the first quarter as mild winter weather encouraged construction.
Building activity jumped 2.3 percent at the start of the year, driving up capital investment by 1.8 percent, the Federal Statistics Office in Wiesbaden said on Tuesday. Private consumption rose 0.4 percent. Gross domestic product increased a seasonally-adjusted 0.7 percent in the January-March period, in line with a May 13 estimate.
Record-low unemployment in Germany is underpinning consumer demand, while companies are benefiting from a cyclical recovery in the 19-nation euro area driven by European Central Bank stimulus. The Bundesbank has expressed confidence that the country’s economy can retain its underlying strength, even though expansion will slow somewhat this quarter.