# Germany on the boil



## Wilkes (13 Feb 2007)

After 15 years of stagnation dealing with the costs of reunification Europe's engine room has surprised analysts with unexpectedly strong GDP growth. Translated this means higher Euro interest rates. 

1.What are the ramifications, good and bad?

2. What likely effect will it have in Ireland as the Base Rate may now rise well above the consensus forecast of 4%?


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## plaudit (13 Feb 2007)

Higher interest rates = lower house prices but we are not allowed to talk about it.


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## room305 (13 Feb 2007)

Don't forget the U.S. wildcard in all of this. Being one of the world's top exporters, Germany depends on :

1) U.S. continuing to import high-end manufacturing and telecommunications goods from Germany
2) U.S. dollar not sliding too much against the Euro ($1.40/€1 is reckoned to be the max pain threshold for German export companies)

Both factors will influence ECB interest rate decisions IMO. Should this not be merged with the "Where are ECB rates headed ..." thread?


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## phoenix_n (13 Feb 2007)

Well its good news if you have invested (wisely) in Germany. Even the property expo this weekend has alot of focus on German investment.

It probably spells another interest rate rise after the one in March.


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