German central bank ups growth forecast to 1 pct

BERLIN (AP) ? Germany's central bank is raising its 2012 economic growth forecast for the country to 1 percent, citing global growth and a boost to domestic demand from a healthy labor market and favorable financing conditions.

The Bundesbank's prediction Friday compared with its forecast last December of 0.6 percent growth in gross domestic product this year. It said the economy could grow by 1.6 percent in 2013, slightly below its previous prediction of 1.8 percent.

Germany's economy returned to healthy growth in this year's first quarter after a hiccup in late 2011. Its borrowing costs have sunk amid the eurozone debt crisis.

The Bundesbank cautions that its forecast comes with "exceptionally high uncertainty and risk" in view of the debt crisis and the possibility of slower growth outside Europe.

Associated Press

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