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How strong will the German recovery be?

Rising business confidence, modest falls in unemployment and the prospect of early elections have led many commentators to call the turnaround for the German economy. We have long been positive on the prospects for Germany because of the pace of reform set by both government and the corporate sector. More recently, investors have begun to share this optimism and the DAX has outperformed other major equity markets. However, this still raises important questions about the strength of the recovery and whether this will be sufficient to sustain the positive mood.

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