The sources said that the German government is likely to raise its forecast for GDP growth for 2024 by 0.1%, to 0.3%, while next year the economy is expected to grow by 1%. As for the inflation outlook, the forecast for CPI growth for 2024 is likely to be reduced by 0.4% to 2.4%. These forecasts are part of the draft spring projections of the government, which the economy minister is due to present next Wednesday.
Earlier this week, the International Monetary Fund said that this year Germany's economic growth will probably be the most modest among the G7 nations. According to updated forecasts, German GDP will grow by 0.2% in 2024 (revised from +0.5%) and by 1.3% in 2025 (revised from +1.6%).
Germany, Europe's largest economy, has been struggling to grow due to high interest rates, weak global demand and political uncertainty. Although inflation and energy prices are expected to ease this year, growth is forecast to remain extremely weak.