German economy to rebound after weak second quarter: Bundesbank

Containers are seen at the loading terminal Altenwerder in the harbour of Hamburg, Germany February 3, 2016. REUTERS/Fabian Bimmer/File Photo

FRANKFURT (Reuters) - Germany’s economy will rebound in the coming months after a weak second quarter and any impact from Britain’s decision to leave the European Union in the near future could be limited, the Bundesbank said in a monthly report on Monday.

The euro zone’s biggest economy has struggled since a superb first quarter with falling industrial production, weak orders and dropping exports raising doubts about its prospects and suggesting that Germany may be succumbing to a broader global slowdown.

But the Bundesbank dismissed those concerns, arguing that one-off factors were contributing to the poor performance and the economy remains on solid footing.

“The fundamental trend remains quite strong and economic output is expected to significantly increase during the summer quarter,” the central bank said.

“The driving factors of the domestically supported upswing remain intact, including the excellent labor market, rising real wages and an expansionary fiscal policy,” it said. “The continued favorable business and household sentiment suggests a purely temporary breather in the second quarter.”

The bank said estimating the impact of Britain’s referendum on EU membership was difficult for now but said for now it only saw a limited near term impact.

Reporting by Balazs Koranyi; Editing by Francesco Canepa