Germany Will Borrow Less in 2013 Thanks To Low Unemployment

he German government said Friday it will borrow less money than planned this year as low unemployment fuels a steady increase in tax income, while a closely-watched survey showed German consumers believe the economic recovery is gaining momentum.

Current plans call for new borrowing this year of 25.1 billion euros ($34.3 billion). In its monthly report, the Finance Ministry said it now “appears assured” that the government won’t need to borrow all of that.

It pointed to tax income in the year’s first 11 months and expectations of strong December revenue.

In November, the government tax take was up 3.9 percent compared with a year earlier at 39.48 billion euros. Over the January-November period, it totaled nearly 495 billion euros, a 3.3 percent increase.

Chancellor Angela Merkel’s new government is pledging both to avoid tax increases and to end new borrowing in 2015.

The German economy, Europe’s biggest, is expected to see growth accelerate next year after only a modest increase in output in 2013. The recovery from recession across the 17-country eurozone is also forecast to continue.

via Mainichi

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza