GERMANY

摘要

A mixed start to the year has seen stronger-than-expected industrial production boost GDP prospects in Q1, despite lacklustre factory orders. Following a downwardly-revised 2.3% (m-o-m) surge in production in January (from 3.3% initially), payback in February was less pronounced than anticipated, declining by 0.5%. This follows a poor Q4 performance last year whereby production fell by -0.8% (q-o-q). Construction performed well in February, though, increasing by 1.3% (m-o-m) after January's 4.5% jump. Investment in construction has been assisted by the expansion of government spending which has been stepped up following the arrival of 1.1 million refugees in 2015. Last month, the finance minister announced 2017 budget plans which will see spending rise by 2.7% (y-o-y) next year, with €10bn to be spent on managing the migrant inflow and over €33bn on investment. Notably, the increased spending will not prevent the government from targeting a balanced budget through 2020, since steady GDP growth and the robust jobs market will hopefully boost tax receipts.