BERLIN (Thomson Financial) - German economic research institute DIW raised its forecast for domestic GDP growth in the second quarter to 0.5 percent from 'about 0.4 percent'.

The institute said the German economy continues to grow healthily but added it is does not expect the surprising growth dynamic in the first quarter to continue.

The Federal Statistics Office on Wednesday published figures showing GDP growth in the first quarter was 1.5 pct in seasonally, price- and calendar-adjusted terms, up from 0.3 percent in the fourth quarter of 2007 and exceeding expectations of 0.7 percent.

DIW said full-year growth prospects for the German economy, adding that more than 2 percent growth is not unrealistic if growth continues in the coming quarter.

judith.csaba@thomsonreuters.com

jcs/kf1

COPYRIGHT

Copyright Thomson Financial News Limited 2008. All rights reserved.

The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.