The German economy moved up a gear in the third quarter, underpinned by a pickup in global demand and higher corporate investment.
Gross domestic product--the broadest measure of goods and services produced in an economy--grew at an annualized rate of 3.3%, compared with 2.6% in the second quarter, the Federal Statistical Office, Destatis, said Tuesday. The outcome beat forecasts of 2.4% growth.
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In addition, Destatis significantly lifted its GDP growth estimate for the first quarter to an annualized rate of 3.6% from an earlier estimate of 2.9%, a sign that Germany's economy is firing on all cylinders.
Economic activity in Europe's largest economy has been brisk and its jobs market buoyant, despite a stronger euro eroding the price-competitiveness of German exports, geopolitical tensions and the threat of heightened trade protectionism.
Germany has been driving the eurozone's economic recovery in recent years, but there are clear signs that the region's upswing is broadening and becoming more sustained. Illustrating this trend, Spain's economy is widely expected to muster growth north of 3% this year.
Destatis said that third-quarter growth was led by improvement in foreign trade amid rising demand for high-end tools and machinery.
The German government's Council of Economic Advisers last week raised its economic growth forecasts for 2017 to 2.0% from an earlier estimate of 1.4%.
"The German economy is experiencing a major upturn," the council said in its annual report.
Following Tuesday's strong GDP showing, another upward revision may be in store, but more than six weeks after general elections, talks to form a new government are still underway and could drag into next year.
Chancellor Angela Merkel's conservatives are exploring a tie-up with the pro-business party Free Democrats and the Greens. Yet economists say that the prospects of major fiscal stimulus are slim.
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(END) Dow Jones Newswires
November 14, 2017 02:30 ET (07:30 GMT)