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German economy minister urges higher spending as first quarter output highest in two years

German Economy Minister Sigmar Gabriel addresses a news conference in Berlin, Germany, May 12, 2016. REUTERS/Hannibal Hanschke

BERLIN (Reuters) - The German government should increase investment on education, infrastructure and innovation, Economy Minister Sigmar Gabriel said on Friday after data showed economic growth in the first quarter hit its highest level in two years.

“The German economy started 2016 on a good footing: industry posted an increase in production, employment is noticeably rising, and higher income of private households is leading to higher private spending,” Gabriel said.

“Our task is to use this momentum to invest in education, modern infrastructure and innovation.”

Germany more than doubled its economic growth rate in the first quarter of 2016 as higher state and household spending, as well as rising investment on construction and capital goods offset a drag from foreign trade, preliminary data showed on Friday.

Reporting by Gernot Heller; Writing by Joseph Nasr; Editing by Michael Nienaber

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