The economies of Germany and the European Union are in good health overall, European Central Bank Governing Council member Axel Weber said in an interview broadcast on Saturday. "The German and European economies are essentially healthy," Weber said in an interview with a German radio station originally taped on Thursday.
However, he said that the slowdown in German economic growth in the second quarter showed that the government's fiscal policy - namely its increase in value-added tax - was having a dampening effect on growth of Germany's gross domestic product.
Weber gave the interview before the US Federal Reserve Bank cut its discount rate by 50 basis points on Friday. "Despite the market turbulence I see no point to revise macroeconomic forecasts," he said. "The German economy can weather this storm," Weber said.