The rising Germany of 2014

       

         Sigmar Gabriel, the German Economy Minister, while speaking the words of optimism about the GDP growth rate during 2015 and 2016, cautions about the need to improve Germany’s mid-term growth prospects. He insisted on investing capital in education, infrastructure and research. The latest forecast of the leading economic institutes is 2.1% in 2015 and 1.8 in 2016. Gabriel also said that the government expects employment  to reach a record high of 43.1 million in work force in 2016. 

         The rising wages and augmented consumer demand are the favourable factors. Gabriel said that the controvertial minimum wage, which came into effect in January, has added to the consumer confidence. The leading European economic institutes have sharply raised their growth forecast for the German economy this year. Augmented output is expected. The fall in the oil price and the strong consumer spending have created a favourable environment for the better days to come. Also, the weak euro has turned out to be an advantage in the growth on industrial production. Also, there have been worries expressed by economists about the low consumer prices, which might drive the economy into a period of harmful deflation. Nevertheless, fresh confidence is witnessed with the steadily increasing wages in the job market.