Bundesbank sees German economy picking up in Q1

Growth in Europe's largest economy could pick up at a faster clip in the current quarter than at the end of the previous year, Germany's central bank said in its monthly bulletin published Monday.

The Bundesbank said that growth would be carried by increasing momentum in the domestic economy that continues to profit from the country's strong labor market. Consumers are also expected to benefit from low oil prices.

The report comes after Germany's statistics office said Friday that the country's economy grew by 0.3% in quarterly terms in the final three months of 2015. Domestic consumption supported economic growth while net trade depressed growth, the statistics office said. Growth was 1.1% in annualized terms.

"The German economy might expand at a somewhat faster pace in the first quarter of 2016 compared with the end of 2015 thanks chiefly to strengthening domestic dynamics," said the Deutsche Bundesbank. "Greater momentum is likely to be provided by consumption, which is continuing to benefit from the buoyant labor market situation," said the bank.

The German labor market got off to a strong start in the New Year, with jobless claims dropping more than expected in January and the unemployment rate hitting a record low. Still labor experts say that the mass influx of migrants into the country will cause joblessness to pick up later this year.

Stronger economic growth in Germany would certainly be welcomed in other eurozone capitals, but it would still continue a pattern of recent years where the German economy is the motor driving the eurozone.

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