KIEL, Germany, June 20 (Reuters) – German economic growth may come closer to 2 percent in 2010 than previously expected, Finance Minister Wolfgang Schaeuble said on Sunday, but will hardly top 1.5 percent on average over the coming years.

In late January, the government forecast gross domestic product in Europe’s largest economy would expand by 1.4 percent in 2010, though some economists have said a figure as high as 3 percent is possible.

“Perhaps we will come closer to the 2 percent figure than we even dared hope just a couple of weeks ago,” Schaeuble said during a speech at an award ceremony in Kiel.

Earlier this month, policymakers including Schaeuble had said the German economy should grow faster than expected, with the recovery gathering pace markedly during the current quarter.

Yet in a separate interview with German weekly magazine WirtschaftsWoche, Schaeuble said growth would not reach much beyond 1.5 percent in the next few years, partly due to demographic trends.

Some policymakers and research institutes have expressed concern that the austerity measures being launched by European governments to head off a spread of the debt crisis begun in Greece will hamper economic growth.

United States President Barack Obama last week said public finance problems should be addressed “in the medium term” — a warning that clamping down budgets should not be done at the expense of recovery. Schaeuble defended the Germany’s decision to launch its biggest austerity drive since World War Two saying economic growth alone would not enable the country to consolidate its ballooning deficit.

“The U.S. is allowed to think that they can solve their exorbitant household deficits through strong growth. I don’t think so but I don’t want to give them any advice,” he said.

“There is no way we could do this in Germany, because we will hardly be able to reach beyond 1.5 percent sustainable economic growth on average over the next few years, partly because of our demographic development.”

Schaeuble said it was his duty to address the causes of the crisis, one of them being public deficits — a realisation the U.S. was “currently repressing a little”.

German Chancellor Angela Merkel on Saturday said Europe would push for a swift exit from fiscal stimulus programmes and a focus on budget consolidation at the G20 meeting next week.

“European participants are of the opinion that this is urgently necessary to prevent such crises from happening again in the future,” Merkel said in her weekly podcast. (Additional reporting and writing by Sarah Marsh; Editing by Jon Loades-Carter)