Germany’s Economic Outlook Downgraded: Experts Warn of Sluggish Growth and Declining Consumer Power

Economic Growth in Germany Hindered by Experts.

In a report on the German economy, five leading economic research institutes have downgraded their GDP outlook for the country. The group emphasized the importance of consumer purchasing power in improving the economic outlook.

Germany’s economy is showing signs of weakness, with declining growth forces and overlapping economic and structural factors contributing to sluggish overall economic development. While a recovery is expected to begin in the spring, experts cautioned that the momentum may not be significant. Domestic demand has not increased as anticipated, with high energy prices affecting the competitiveness of energy-intensive goods, a key strength of the German economy.

The “diagnosis” was compiled by five prominent German economic research institutes, including DIW in Berlin, IfW in Kiel, IWH in Halle, RWI in Essen, and Ifo in Munich. Additionally, Germany’s economy is facing challenges due to a sharp tightening of fiscal policy by the government in preparation for the return of the constitutional debt brake. As a result, Germany was the worst-performing major economy in the world last year. However, projections for next year anticipate growth picking up to 1.4%.

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