Early Wednesday morning, the German Ministry of the Economy cut its forecast for that countrys economic growth to near-recessionary levels. The market could not care less: a benchmark index for the local stock market was up, a sale of the governments sovereign debt was reported as drawing record demand, and another report showed investors were growing more optimistic on German equities.
Those developments came as a result of a market apparently estimating the expectedly low growth in the German economy is still a surer bet than the economic contraction other countries in the Eurozone could conceivably experience in 2012.
In the land of economic contraction, it seems, even the most abysmal of growth forecasts is king.
Earlier Wednesday, German Economy Minister Philipp Roesler said his government saw the national economy growing at a rate near 0.7 percent for the year — a reduction over previous forecasts of 1 percent growth. Before the Eurozone sovereign debt crisis intensified in October, the forecast had stood at 1.8 percent.
The German economy, a powerhouse of the European Union, is believed to have shrunk by 0.3 percent in the just-ended 2011 fourth quarter.
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