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Quality prelim analysis for all three economic concepts. Your team is ready to print out a hard copy of this padlet and drop it into my pigeon hole at BA office, level 9, by 1st Dec. Of course, if you want to work on it a bit more (see below), no problem! Otherwise, time to kick start your report writing. Some suggestions for you to explore stated below. But don't be restricted by these suggestions.

GDP:
Further questions for thoughts (consider addressing this in padlet and/or report):
1. Check full employment % of Germany to conclude that the economy is experiencing natural rate of unemployment (highlighted).
2. How important is international trade to Germany's GDP? What caused the steady recovery in exports demand?
3. How would improvements in labor laws such as work life balance and lax in innovation regulation helped to improve productive capacity? Find out more about these government policies if you want.
4. "premier manufacturing location" was mentioned in the article. How would this affect Germany's economy?

Unemployment:
1. Yes. Productivity issues been an ongoing concern in UK. Good to continue with your research on the existing policies or "going-to-be-implemented" policies by the government to contain structural unemployment/real wage growth.
2. In terms of falling cyclical unemployment, it would be good to associate it with the positive outlook of the economy (GDP).

Inflation:
This article doesn't cover much on the cause of inflation, restricting your prelim analysis. Nonetheless, I still see good effort in analyzing!
1. What is Germany's targeted inflation. Comparing it to the current rate, is disinflation a worrying trend?
2. Might want to explore further on the dampening of the demand-pull and or cost-push inflation.
3. We will learn more about monetary policy in a few weeks time and good work in explaining the impact on cost of borrowing. Continuing from your explanation, how would keeping interest rate low impact general price levels?

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TOPIC- GDP

A forecast was recently published in the German papers that there would be a steady economic growth for Germany in the later quarters of 2017 and the year 2018, both being increasingly higher. Furthermore, there is a government budget surplus of $36.4 billion this year, which amounts to one whole percent of their GDP with it being the highest since reunification. This shows that the economy is experiencing the natural rate of unemployment where they are expanding or near its peak.

With accordance to the article, this predicted increase of GDP was based on strong domestic consumption, private and public investments - particularly in Research & Development and Equipment, and the steady recovery of Germany as an export-driven economy.Thus, using the expenditure approach, as there is more expenditure per household(C), more investments by films(I), larger government budget surplus to boost the economy by spending on goods and services(G) and having strong export trade(X), this would all result in an increase in GDP. Using the flow of income table, it can be deduced that with the increasingly high expenditure of the economy, reaps an exceptionally large income earned per household.

However, despite a healthy growth rate, the German government must be mindful of the possibility of an overheated economy, and policy decisions solely geared towards expansionary aims might be detrimental to the economy in the long run. They should, and indeed have been considering long-term policy goals to keep this growth sustainable, through measures such as the maintenance of budget surplus, improved labor laws to further enhance work-life balance, and further loosening of government regulations hindering innovation and accelerated movement into digital change. This will enable Germany to expand their productive capacity in the long run, allowing them to achieve positive, sustainable economic growth.

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Business Facilities - Area Economic Development, Site Selection & Workforce Solutions

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The German Council of Economic Experts (GCEE) presented Chancellor Angela Merkel with a late re-election gift this week: A forecast of steady economic growth for the next two years. Germany's GDP is expected to grow by 2.2 percent in 2018, on the back of a predicted 2 percent rise in 2017, according to the council, with the 2017 projection a sharp increase on the previous one of 1.4 percent. There is set to be a budget surplus of $36.4 billion (€31.3bn) this year, a whole one percent of GDP and the highest since reunification.

The report pointed at strong private consumption, private and public investment - particularly in equipment and R&D - and the steady recovery of the Eurozone as a whole benefitting Germany as an export-oriented economy, as the primary reasons for the optimistic forecast.

Businesses also have reason for optimism, as the German business climate index from Munich's Ifo Institute reached a monthly record of 116.7 points in October.

"The solid economic situation provides an ideal opportunity to re-adjust economic policy in order to prepare Germany for the challenges of the future," said the GCEE Chair, Christoph M. Schmidt.

Among the recommended adjustments were suggestions geared towards making the growth more sustainable, including maintenance of budget surplus, improved labor laws to further enhance work-life balance, and further loosening of regulations hindering innovation and accelerated movement into digital change.

"The GCEE report is significant in that it marks out Germany's economy as a place for manufacturing, research and innovation," said Dr. Jürgen Friedrich, CEO, Germany Trade & Invest. "Our export economy continues to be a pillar of strength, also helping us develop further as the premier manufacturing location within the Eurozone economy of 500 million people. Meanwhile, the strong investment in R&D noted by this report is a sign that we are not only concerned with the current bottom line, but also future ones."

Germany Trade & Invest is the foreign trade and inward investment agency of the Federal Republic of Germany. The organization advises foreign companies looking to expand their business activities in the German market. It provides information on foreign trade to German companies that seek to enter into foreign markets.

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Steady Economic Growth Predicted For Germany

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The German Council of Economic Experts (GCEE) presented Chancellor Angela Merkel with a late re-election gift this week: A forecast of steady economic growth for the next two years. Germany's GDP is expected to grow by 2.2 percent in 2018, on the back of a predicted 2 percent rise in 2017, according to the council, with the 2017 projection a sharp increase on the previous one of 1.4 percent.

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TOPIC-Inflation

Recently, Germany has been experiencing disinflation. Disinflation is a reduction in the rate of inflation in the current year compared to previous years. Just this year, from September to October 2017, the preliminary inflation of Germany has decreased by 0.4 percent. Prices were subdued and disinflation occurred in most sectors. The

Inflation rate is lower than what was predicted earlier on in 2017, hence the softening of inflation is not likely to be due to one-time factors, and is likely to continue. This will lessen the risks that would have come with a higher inflation rate.

The softening of inflation will aid with the continuation of easy monetary policies in Germany, enabling the money supply to increase. This is so that Interest rates will not spike unexpectedly and taking loans from the bank will not become increasingly difficult for citizens. Especially during inflation, the borrowers would be the winners since the real interest rate that is paid by the borrowers is less than the stated nominal interest rate.

Disinflation has brought good news to Germany, but there are the risks as well. Germany has previously predicted a higher inflation rate, which resulted in the European Central Bank deciding to put off its asset purchase program  until the end of 2018. However, now the inflation rate seems to have become gentler and steadier, which means that there will not be any sudden spike in inflation rate, until the asset purchase program starts in 2018. This creates the risk of the first spike in interest rate to occur later on than was previously expected.

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German inflation softens unexpectedly in October, euro area inflation likely weakened

Monday, October 30, 2017 5:47 PM UTC

German inflation figures for the month of October came in softer than expected. The headline HICP inflation in Germany decelerated surprisingly to 1.5 percent in the month of October from September's 1.8 percent. Inflation was also down in Spain to 1.7 percent in the month from September. This signifies that the euro area inflation might have decelerated to 1.4 percent, as compared with the prior forecast of a rise to 1.6 percent, noted Nordea Bank in a research report.

The data from German states shows that prices rises were subdued and annual inflation decelerated in most sectors. The service sector's preliminary inflation data showed a year-on-year print of just 1.2 percent, as compared with September's 1.6 percent.

Therefore, it appears that the softness in Germany and in the euro area core inflation, which was noted in September, was probably not because of one-time factors, stated Nordea Bank. Thus, the upward trend in core inflation that was recorded earlier in 2017 has taken a breather and therefore there are now increased risks to the downside to the inflation projection.

The low inflation definitely merits for continuation of easy monetary policy. As the European Central Bank's last week made the tapering decision that extends the asset purchase program at least until September 2018 and most possibly until the end of next year, it certainly creates a risk that first hikes in interest rates would come later than was expected earlier, added Nordea Bank.

At 17:00 GMT the FxWirePro's Hourly Strength Index of Euro was bearish at -92.379, while the FxWirePro's Hourly Strength Index of US Dollar was neutral at -47.854. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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German inflation softens unexpectedly in October, euro area inflation likely weakened - EconoTimes

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German inflation softens unexpectedly in October, euro area inflation likely weakened Monday, October 30, 2017 5:47 PM UTC German inflation figures for the month of October came in softer than expected. The headline HICP inflation in Germany decelerated surprisingly to 1.5 percent in the month of October from September's 1.8 percent.

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TOPIC- Unemployment

Last month, Germany experienced a decline in unemployment (more specifically cyclical unemployment). This can be attributed to the strengthening and growing economic performance of the country, with the demand for labour surging, leading to more jobs being created, and cyclical unemployment will fall with an upswing in the business cycle.

However, despite this increase in unemployment, it is imperative to note that the quality of workers are still relatively stagnant, with many workers still remaining in low-wage jobs, and wage increase are unlikely to occur in the near future. This is prevalent not just in Germany, but throughout all 19 nations in the eurozone.

This brings about the possibility of future structural unemployment. The German labour force, primarily consisting of many low-wage job positions, may find themselves in an unfavourable condition should companies upgrade their processes and displace their manual labour with the latest cutting-edge technology. Only workers with the necessary skills and capable of operating these machinery will be able to retain their jobs in such a scenario. Hence, it would be necessary for the government to consider adopting skills-upgrading courses and retraining to improve the quality of the workforce rather than to have a growth-centric approach in their policy formulations.

Any form of expansionist measures to further boost the economy may lead to even more jobs being created, and wages may fall further, eventually leaving a nation of unskilled workers ill-prepared to handle the challenges of the future.

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German unemployment declined in October as companies added workers to meet surging demand, underpinning already strong growth momentum in Europe's largest economy.

The number of people out of work fell by a seasonally adjusted 11,000 to 2.495 million, the Federal Labor Agency in Nuremberg said on Thursday. That beat the median estimate in a Bloomberg survey for a drop of 10,000. The jobless rate held at record low of 5.6 percent.

Germany is heading for its best growth performance in six years, with consumption benefiting from a strengthening labor market and companies more optimistic than ever that the global recovery will fuel demand. The most recent Purchasing Managers' Index showed job creation in manufacturing was among the fastest in the survey's history.

"The very good development in the labor market continues," labor agency head Detlef Scheele said in a statement. "Dynamic employment growth continues and company demand for new employees is increasing."

The Institute for Employment Research predicts unemployment will decrease by some 60,000 people in 2018, Scheele told reporters in Nuremberg.

In October, joblessness fell by about 7,000 in west Germany and by 4,000 in the eastern part of the country.

Impressive Performance

"The German labor market remains an impressive engine for the entire economy," said Carsten Brzeski, chief economist at ING-Diba AG in Frankfurt. It "also illustrates why significant wage increases are still way off."

The number of people in low-wage jobs remains close to an all-time high, and trade unions are focusing on the quality of work in addition to negotiating higher wages, Brzeski wrote in a note to clients.

Sluggish wage growth -- not just in Germany but also in the 19-nation euro area -- is one reason why the European Central Bank is advocating prudence in scaling back ultra-expansionary monetary stimulus. Policy makers decided last week to extend asset purchases through September at half the current monthly pace to fuel inflation, which remains far below the institution's goal even as the economy is headed for its best annual performance in a decade.

The Bundesbank predicts that the German economy may have maintained its growth pace of the first half of the year in the third quarter. First data will be published on Nov. 14. Economists in a separate survey project an expansion of 0.5 percent.
- With assistance by Kristian Siedenburg, and Andre Tartar

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German Unemployment Extends Decline as Economy Powers Ahead

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German unemployment declined in October as companies added workers to meet surging demand, underpinning already strong growth momentum in Europe's largest economy. The number of people out of work fell by a seasonally adjusted 11,000 to 2.495 million, the Federal Labor Agency in Nuremberg said on Thursday.