Economic institutes in Germany lower growth forecast for 2019

BERLIN, March 14 (Xinhua) -- The Munich-based Institute for Economic Research (ifo) on Thursday revised down its forecast for German economic growth in 2019 from 1.1. percent to 0.6 percent.

"Industry will largely fail to act as an economic engine in 2019", ifo economic director Timo Wollmershaeuser said. As the international economy continued to lose momentum, global demand for German products would be weak, Wollmershaeuser added.

According to ifo, the number of people in employment in Germany will continue to rise from 44.8 million in 2018 to 45.5 million in 2020. ifo is expecting the unemployment rate in Germany to continue to fall to 4.7 percent.

Also on Thursday, the German Institute for Economic Research (DIW) similarly cut its growth forecast for the current year by 0.6 percentage points to 1.0 percent.

"The German economy is cooling down, but this is not the end of the world. We should not paint too black a picture, because the labor market in particular continues to look excellent and private consumption is also strong", said Marcel Fratzscher, president of DIW.

On Wednesday the Kiel Institute for the World Economy (IfW Kiel) revised its forecast for the growth rate of German GDP in 2019 from 1.8 percent to 1.0 percent.

"The German economy is showing clear signs of slowing, which will also have an impact on public budgets. But at present there is nothing to suggest an abrupt decline in the economy or even a recession. The employment situation will therefore remain steady," said IfW Kiel president Gabriel Felbermayr.

At the end of January, the German government lowered its official GDP growth forecast to 1.0 percent. In its autumn forecast, the German government had still assumed GDP to grow by 1.8 percent.

For 2020 however, ifo cautiously raised its growth forecast from 1.6 percent to 1.8 percent. "The current production difficulties of German industry are likely to be overcome only gradually", Wollmershaeuser explained.