WIESBADEN - The German economy gained pace at the start of this year. As the Federal Statistical Office (Destatis) already reported in its first release of 13 May 2016, the gross domestic product (GDP) increased 0.7% - upon price, seasonal and calendar adjustment - in the first quarter of 2016 compared with the fourth quarter of 2015. The moderate growth path of last year ( 0.3% in the last quarter of 2015) thus accelerated.
The quarter-on-quarter comparison (following price, seasonal and calendar adjustment) reveals that positive contributions mainly came from domestic demand. Especially fixed capital formation increased markedly at the beginning of the year. Gross fixed capital formation in machinery and equipment rose by 1.9% on the fourth quarter of 2015. Gross fixed capital formation in construction even increased by 2.3%, one reason being the mild weather. Final consumption expenditure of households rose by 0.4% and government final consumption expenditure increased by 0.5% on the previous quarter.
The gross domestic product rose year on year, too. The price-adjusted GDP was up by 1.3% in the first quarter of 2016 ( 1.6% after calendar adjustment), following 2.1% in the fourth quarter of 2015 ( 1.3% after calendar adjustment).
Also in a year-on-year comparison, contributions to growth were mainly made by domestic demand in the first quarter of 2016. Household final consumption expenditure increased by 1.8%, while government final consumption expenditure was up 2.7%. Gross fixed capital formation in machinery and equipment rose a price-adjusted 2.4% on the first quarter of 2015. Gross fixed capital formation in construction increased, too ( 1.9%), particularly in dwellings and in public construction. On the whole, domestic uses rose by 2.0%. Arithmetically, the balance of exports and imports had a downward effect on economic growth (-0.5 percentage points) compared with a year earlier. Although exports of goods and services increased by a price-adjusted 1.5% on a year earlier, the increase in imports was markedly larger ( 3.1%) in the same period.
On the production side of the gross domestic product, price-adjusted gross value added at the beginning of 2016 was higher than a year earlier in all economic sectors. The highest growth rates were recorded for financial and insurance activities ( 2.5%) and for information and communication services ( 2.3%). On the whole, the price-adjusted gross value added of all economic sectors was up 1.0% on the first quarter of 2015.
At current prices, the gross domestic product was up by 3.1% and the gross national income by 3.2% in the first quarter of 2016 on the first quarter of 2015. Net national income (at factor costs) rose by a total of 3.2%. According to first provisional calculations, the compensation of employees ( 4.0%) grew markedly faster than property and entrepreneurial income ( 1.8%). Gross wages and salaries of employees rose by 4.3% and net wages and salaries by 4.2% on a year earlier. The average wages and salaries per employee did not rise that much ( 2.7% in gross and net terms) because the number of employees went up as well ( 1.5%) compared with the same quarter one year earlier. The disposable income of households was up by 2.5%, this rise being slightly higher than that of household final consumption expenditure at current prices ( 2.4%).
1 Change on the previous year or the same quarter of the preceding year in %. 2 Change on the previous year or previous quarter in %. 3 As for years, the calendar-adjusted values equal the seasonally and calendar-adjusted values (except for differences due to rounding). qtr = quarter