Germany is Worried About Weak Economic Recovery
The Germany Ministry of Finance considers there is a risk that the current economic recovery will not be sustainable, writes Reuters.
“Despite a categorically improved economic outlook, it is not clear, for now, if the period of stability will continue. This could have this year, negative effects on the labor market “, says a report from the German ministry.
Germany recovered in the second quarter from the most severe recession since the Second World War, with an unexpected economic growth of 0.3%, confirming the effectiveness of government incentive programs.
With the banking system still fragile, analysts warned the optimism caused by the positive GDP could be unwarranted, drawing attention to the low growth rate, of the fragility of the banking system, the plight of the labor market and the decline in consumption.
The use of the programs to reduce the working week moderated the growth in the number of unemployed in Germany, where unemployment rose by only 300,000 people since the financial crisis began in September 2008.
The government estimates that the economy will shrink by 6% this year, but growth in the second quarter could improve the projection.