Germany’s economy grew by a robust 0.7 per cent in the last quarter of 2014, well above forecasts, while France continued to wallow, official data showed on Friday.

The revival of Europe’s largest economy followed stagnation over the previous two quarters. It had been expected to expand by 0.3 per cent.

Domestic demand lifted Germany out of its mid-year lull and allowed it to achieve 2014 growth of 1.6 per cent.

The Statistics Office said a slow summer had been overcome with household spending picking up significantly. “This is a thunderbolt.

Economic recovery in Germany started much earlier than expected. Some spoke of possible recession after the summer but instead Germany rebounded.

France could not keep pace, growing by just 0.1 per cent, meaning the euro zone’s second largest economy advanced by just 0.4 per cent across the whole of 2014.

“It’s obviously still too weak, but the conditions are ripe to permit a cleaner start of activity in 2015,” said finance minister Michel Sapin, who added that business leaders were already beginning to increase investment.

On Monday, France’s central bank predicted first quarter growth of 0.4 per cent, led by a rise in industrial production and a slight improvement in services activity.

Reuters