Germany, with Europe's biggest economy, says it is balancing its budget faster than expected.

The German government says it expects its budget deficit to be cut to 1.5 percent this year, two years earlier than required by the European Union, and that its budget will be balanced by 2014. The deficit reached 3.3 percent last year, higher than the 3 percent allowed by the European Union.

As several EU nations struggle with sluggish economic growth and massive governmental debt, Germany's economy has recovered since the 2008 global recession. It has, however, slowed in recent months, much like in other European nations and the United States.

The German economic slowdown could create problems for the continent as it seeks to end a debt contagion that already has forced Greece, Ireland and Portugal to secure international bailouts to help solve their financial woes.

Germany has resisted calls for the sale of euro bonds backed by the 17 nations that employ the common euro currency. Sale of such bonds could cut the high borrowing costs for debtor nations, but also raise borrowing costs for Germany, whose benchmark bonds carry the European Union's lowest interest rates.

European officials are trying to prevent the need for more bailouts, especially in large economies like Italy and Spain. The European Central Bank says it bought more than $20 billion worth of bonds from the Madrid and Rome governments last week, an effort aimed at controlling their borrowing costs.