German economy slows despite investments

Berlin - The German economy slowed in the third quarter despite a strong pickup in both corporate investment and government spending, data released Friday showed.

Europe's biggest economy expanded by a modest 0.3% quarter on quarter during the three months to the end of September, down from 0.7% in the second quarter, the statistics office said, confirming data it released last week.

"Positive contributions in the third quarter were made exclusively by domestic demand," it said.

In particular, this included a quarter-on-quarter 0.5% gain in investment in machinery and equipment.

Building sector investment jumped by 2.4% in the quarter.

Government spending was up 0.5%, while consumer spending edged higher by 0.1%.

However, trade acted as a drag on the nation's third-quarter gross domestic product (GDP) with imports growing by 0.8% and at a much faster pace than exports, which increased by just 0.1%.

As a result, trade made a negative contribution to GDP of minus 0.4 percentage points, the statistics office said.

Year-on-year GDP grew by 1.1% in the third quarter compared with 0.9% in the three months ended June.