BERLIN: The German economy, which grew strongly earlier this year on the back of robust exports, will see a slowdown in growth in 2005 as a result of runaway oil prices and a tailing off of foreign demand for German-made goods, top research institutes said yesterday.

In their traditional autumn report, Germany's six leading institutes actually revised upwards their growth forecast for the current year to 1.8 per cent from 1.5pc previously.

But five of the think-tanks - Ifo in Munich, HWWA in Hamburg, RWI in Essen, IfW in Kiel and IWH in Halle - said they expected growth of the eurozone's biggest economy to slow to 1.5pc next year.

Only Berlin-based DIW was more optimistic, pencilling in growth of 2pc in 2005.

The German government jumped on the upward revision for 2004 growth, saying it provided proof that recovery was continuing and would remain "robust".

Furthermore, hitherto sluggish domestic demand would also begin to pick up, Economy Minister Wolfgang Clement said in a statement.