Expanding exports and domestic consumption pushed Germany’s economy — Europe’s biggest — to grow slightly faster than expected between April and June, preliminary data showed yesterday.
With a 0.4 percent increase in calendar and seasonally-adjusted terms, GDP grew slightly slower than the previous quarter’s 0.7 percent, a statement from federal statistics office Destatis said.
That was twice as fast as analysts surveyed by Factset had predicted.
“Compared with the previous quarter, positive impulses came from the trade surplus. Preliminary estimates showed exports increased compared with the first quarter of this year,” the statisticians said.
“Private consumption spending and state consumption spending also bolstered growth,” the statement said.
Compared with the same period last year, the economy showed growth of 3.1 percent — “stronger than at any time in the past five years,” Destatis said.
However, there were some weaker spots in the overall picture.
“Growth was slowed by weak net investment, especially in facilities and construction, where less was invested after a strong first quarter,” the statisticians said.
ING Diba bank’s Carsten Brzeski said “the current recovery is clearly running on its very last leg,” pointing to weak investments, which he said are unlikely to return to healthy levels given the shock of the UK’s vote to quit the EU, as well as fears of a wider global slowdown.
Domestic consumption alone without investment will not be able to maintain growth indefinitely, Brzeski said.
Yesterday’s data are only preliminary, with a full GDP reading and detailed breakdown to be published on Aug. 24.
Meanwhile, inflation in the German economy picked up slightly last month, final official data confirmed.
Germany’s national inflation yardstick, the consumer price index, grew by 0.4 percent, Destatis said.
The uptick was driven by rising food and service prices, but slowed as energy and clothing became cheaper.
Inflation in Germany remains well short of the target of just under 2 percent set by the European Central Bank.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Qualcomm Inc, the world’s biggest seller of smartphone processors, gave an upbeat forecast for sales and profit in the current period, suggesting demand for handsets is increasing after a two-year slump. Revenue in the three months ended in June will be US$8.8 billion to US$9.6 billion, the company said in a statement Wednesday. Excluding certain items, earnings will be US$2.15 to US$2.35 a share. Analysts had projected sales of US$9.08 billion and earnings of US$2.16 a share. The outlook signals that the smartphone market has begun to bounce back, tracking with Qualcomm’s forecast that demand would gradually recover this year. The San
Clambering hand-over-hand, sweat dripping into his eyes, a durian laborer expertly slices a cumbersome fruit from a tree before tossing it down to land with a soft thump in his colleague’s waiting arms about 15m below. Among Thailand’s most famous and lucrative exports, the pungent “king of fruits” is as distinctive in its smell as its spiky green-brown carapace, and has been farmed in the kingdom for hundreds of years. However, a vicious heat wave engulfing Southeast Asia has resulted in smaller yields and spiraling costs, with growers and sellers increasingly panicked as global warming damages the industry. “This year is a crisis,”