Brighter German Economic Prospects Trigger Overheating Alarm
- 2017 GDP seen rising 2.3%, exceeding potential growth of 1.4%
- Research institute warns of misinvestments, asset bubbles
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Germany’s economy is growing at its strongest pace since 2011 and accelerating -- and one of the country’s leading research institutes says that’s a problem.
The Kiel Institute for the World Economy predicted on Thursday that Germany’s expansion in gross domestic product will pick up to 2.3 percent in 2017 from 1.8 percent in 2015. With next to no slack and potential output growth at only 1.4 percent, Europe’s largest economy is poised to overheat, according to Stefan Kooths, head of the institute’s forecasting center.