German economists say low rates helping recovery
The European Central Bank has been urged not to raise interest rates too quickly as the current low level of rates in the euro zone is aiding the modest economic growth in Germany.
This is despite economic growth forecasts in Germany being cut to 1.5% this year and next, from an initial forecast of 1.7%.
Six leading economic institutes said that the German recovery will only 'gradually gain momentum' over the next two years, according to their traditional spring report, published today.
The six institutes - Berlin-based DIW, Ifo in Munich, HWWA in Hamburg, RWI in Essen, IfW in Kiel and IWH in Halle - said that German gross domestic product (GDP) would be 1.5% in both 2004 and 2005.
Today's report also predicted that the total number of people out of work in Germany would average 4.332 million in 2004 compared with 4.376 million last year and that the number out of work would fall 'only slightly' in 2005.
