Germany sees public debt falling 2 percentage points in 2017

BERLIN (Reuters) - German public debt is expected to fall by some 2 percentage points this year, the government said in a report on Wednesday, keeping Europe's largest economy on track to bring down debt to below 60 percent of economic output by 2020.

Debt stood at 68.3 percent of output in 2016, the government said in its report, which it will present to the European Commission.

European Union rules say countries should keep the ratio of debt to gross domestic product (GDP) at no more than 60 percent or at least be heading down towards that level. The rules have been broken for years by Germany and other countries.

The German government said in its report that the low interest rate environment created by the European Central Bank had lightened Germany's debt burden.

A stability programme agreed by the government last year also includes a goal of no net new debt until 2020 despite higher state spending.

"This course has proven to be a guarantor of growth, secure jobs and prosperity," Finance Minister Wolfgang Schaeuble said in a statement.

(Reporting by Gernot Heller; Writing by Joseph Nasr; Editing by Paul Carrel)