The prevailing conditions for the German economy at the turn of the year read like a dream come true: a competitive export industry, sound public finances, a high level of employment, rising actual income, a supportive fiscal and monetary policy, good financing conditions, a banking system that has been largely cleaned up, sinking commodity prices, overall stable prices, a moderately depreciating currency, and a respectively expanding economy.
But despite all that, the forecasts by the research institutes and bank economists for economic growth in 2015 is only about 1.5 percent. This roughly corresponds to growth in the closing year.
One thing is already clear: The number one growth-driver in 2015 will be consumer spending. Employment rates will probably once again reach record levels and at the same time a strong rise in actual earnings is to be expected.
The introduction of the minimum wage will also have an effect. It could be accompanied by a slight rise in the number of unemployed. In addition, with oil prices being almost cut in half, households’ disposable income will increase.
All of this would indicate that the spending mood of the Germans will once again become stronger.
However, increased consumer spending could also result in foreign trade having a negative contribution to economic growth in 2015. Even if exports once again are approaching record levels, there will be an even greater increase in imports.
Also, because of the German government’s political goal of achieving a balanced budget, stimulation through government spending will more likely be reduced than increased.