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"Growth this year is expected to remain moderate as strong
domestic demand buoyed by favorable fiscal and monetary
conditions is offsetting weak external demand," the IMF said in
its latest economic assessment on Europe's biggest economy.
In its key policy recommendations for Berlin, the IMF said
Germany should step up public and private investment to meet
infrastructure needs.
Berlin should also accelerate structural reforms to boost the
economy's growth potential by broadening the labor market
participation of refugees, women, and older workers, it added.
The IMF also called on Germany to remove impediments to housing
supply expansion to help relieve the pressure on the housing
market, and also to implement measures to strengthen the
oversight role of banks' supervisory boards.
The IMF said it expected Germany's current account surplus to
stay near record levels this year. In mid-April, the Fund said
it expected the German economy to grow by 1.5 percent in 2016
and 1.6 percent in 2017.
Last month, the German government stuck to its economic growth
forecast of 1.7 percent for this year, despite a slowdown in
emerging markets, as strong domestic demand is replacing exports
as the main pillar of Europe's largest economy.
(Reporting by Michael Nienaber; Editing by Paul Carrel)
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