The German government has raised its forecasts for economic growth to 2.3% this year and 1.4% in 2007.
Previously, the government had been pencilling in gross domestic product growth of 1.6% for 2006 and 1% for 2007.
The updated forecasts are exactly in line with new figures published by the country's six leading economic research institutes on Thursday. Economy minister Michael Glos had already signalled an upgrade in this year's growth forecast to around 2.5%.
'It is particularly pleasing that the recovery is feeding through to the labour market and does not represent any danger to price stability,' Mr Glos said in a statement.
In 2005, the German economy expanded by just 0.9% and growth this year looks set to achieve its highest rate since 2000 when GDP grew by 3.1%.
The anticipated slowdown in growth in 2007 will come as a result of the government's plans to raise VAT by three percentage points to 19%, which is expected to put the brakes on private consumption.
