Overall, GDP growth is projected to remain solid in 2016 and 2017, as domestic
consumption remains strong and the demand for German exports in the euro area recovers
and compensates emerging economies’ weakness.
The newly arrived humanitarian
immigrants will start looking for jobs only gradually and immigration is assumed to
diminish. The cyclical unemployment rate is expected to remain low, but the natural rate will
rise because of the inflow of large numbers of refugees with a long distance from
Consumer price inflation is projected to rise, as wage growth has picked up,
there is little remaining economic slack, and as the effect of the fall in oil prices will wear off
(the trend assumes, as a technical matter, that oil prices and exchange rates remain
constant going forward). Weaker export growth, robust domestic demand growth and lower
net foreign capital income are projected to reduce the current account surplus somewhat.