BERLIN, March 19 (Xinhua) -- Germany will most likely sustain its economic momentum during the first quarter (Q1) of 2018, an official report published on Monday by the German Central Bank (Bundesbank) found.
"The strong growth of the German economy is likely to continue through the first quarter of 2018", the Bundesbank monthly report read.
The lasting positive economic development anticipated by the Frankfurt-based monetary institution was seen to be underpinned by large amounts of outstanding orders received by German industry in the second half of 2017. At the same time, further increases in domestic private consumption would be sustained by rising wages and historically-low unemployment.
The Bundesbank also warned, however, that demand had reached such proportions in certain sectors of the economy that businesses were struggling with "significant capacity bottlenecks". The report highlighted the construction sector in this context which would consequently make an "at best limited contribution to overall economic growth" in Q1.
Also on Monday, in the newspaper "Neue Osnabruecker Zeitung", Bundesbank President Jens Weidmann sharply criticised proposals to create an independent European Monetary Fund (EMF) and increase funding levels for the European Union's (EU) supra-national governance bodies made by the European Commission, French President Emmanuel Macron and German Chancellor Angela Merkel (CDU) amongst others.
"Giving the EU more funds cannot be an end in itself", Weidmann said. Firmly rejecting a vision of European federation, the central banker opined that "authorities could perhaps also be returned to member states."
Weidmann hereby demonstrated his opposition to the new government's commitment to Europe formalised in the "grand coalition" agreement as an overriding priority for Chancellor Merkel's fourth ruling cabinet. Berlin views further integration as a necessary means to prevent internal conflict, lower regional inequalities and ensure the political autonomy, physical safety and material prosperity of Europe in an increasingly multipolar world order.
Speaking to "Neue Osnabruecker Zeitung", Weidmann additionally called for an end to the European Central Bank's ongoing large-scale bond-purchasing programme in light of the "good economic situation and forecast price development." According to Weidmann, the macroeconomic environment would enable a "swift exit" from quantitative easing (QE).
