Domestic demand to lead German economy in future

In recent years, China has become fourth largest export destination for German. China share in German's total exports is almost 7%. However,  German's export to China is expected to narrow down in near future as its export to U.K. and U.S. is increasing continuously.

German a manufacturing based economy; therefore, growth rate of the economy is highly driven by the export of manufacturing product. The export of manufacturing sector is highly vulnerable to shocks from the external sectors. However, domestic demand in German has improved and strong enough to lead the economic growth of the country. Therefore, the economy seems to be out of risk. 

"The subdued outlook for global growth prevents Germany from attaining growth beyond 2%, but fiscal policy will be more expansionary. There will be bumps on the road ahead, but we feel comfortable with our growth forecast of 1.8% for next year. So, although not at very high speed, Germany remains a growth engine for neighbouring countries and the Nordics with their close trade relations to Germany", argues Nordea Bank.