BERLIN: German economic growth will pick up to 1.9 percent this year due to strong domestic demand, but the expansion rate in Europe's biggest economy will nearly halve in 2017 as Brexit and other risks hit exporters, the DIW institute said on Thursday.
"The German economic engine is likely to start stuttering for a while," DIW said in a statement, adding that Britain's decision to leave the European Union would limit Germany's growth prospects in the coming months.
"The Brexit decision is likely to put the brakes on German foreign trade until the middle of 2017," the institute said.
DIW raised its 2016 growth forecast for the German economy to 1.9 percent from 1.7 percent, mainly due to a surprisingly strong performance in the first six months of the year.
But it lowered its 2017 growth forecast for Germany to 1.0 percent from 1.4 percent, partly because of special factors such as more holidays falling in working weeks next year.
Last year, the Germany economy grew by 1.7 percent, the strongest rate in four years thanks to soaring private consumption and higher state spending.
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