GERMAN Economics Minister Mr Gueter Rexrodt said yesterday he expected the German economy to expand in 1996 at a relatively narrow rate of about 2 per cent.

Mr Rcxrodt said he did not foresee the economy brimming over during 1996 after the economy grew more hesitantly than expected last year.

"It will be at about 2 per cent." Mr Rexrodt said of expected growth for 1996.

Mr Rexrodt's comments came after Germany's Bild newspaper reported during the weekend that German real economic growth in 996 was expected to be at about 2 per cent and the average number of unemployed workers would stay at about 3.5 million.

The mass-circulation daily, citing government estimates to be presented in a report in late January, said inflation was expected to remain stable at almost 2 per cent.

A government spokeswoman in Bonn said the annual economic outlook report was not yet completed.

Economists have said they expect Germany's economy to stage a modest recovery in 1996 from its current woes but surging unemployment and a strong deutschmark mean its problems are not over.

Some economists, including the respected Munich-based Ifo Institute, have sharply revised growth forecasts for 1996 after dropping forecasts for l995 to as low as 1.5 per cent from the earlier 2 per cent and the 2.9 per cent growth in 1994.