Germany's export-driven economic recovery is likely to continue over the coming months and private consumption should begin to pick up, the German Finance Ministry said in its monthly report today.
"Exports should remain the economic motor and impact positively on the development of domestic demand," the ministry wrote. "This is what the upwards trend in both domestic and foreign industrial orders indicates."
Germany exited its deepest post-war recession in the second quarter of last year but the recovery slowed in the winter when severe weather disrupted business activity.
Recent economic indicators have beaten forecasts and pointed to a renewed pick-up. Industrial output and orders surged in March, while exports rose at their fastest rate in nearly 18 years, surpassing even the most optimistic predictions.
The ministry said the upwards trend in industrial output would continue over the coming months.
Caution over private consumption would fade away as the recovery continued and households would start spending slightly more, the ministry added.
"The relatively good development on the labour market should increasingly contribute to the recovery of private consumption," it said.
Reuters