• Sun. May 26th, 2024

Germany’s Economic Research Institutes Lower GDP Forecast Due to Factors Such as Domestic Demand and High Energy Prices

BySamantha Nguyen

Mar 27, 2024
Economic growth for Germany cut by experts

Economic research institutes in Germany have lowered the country’s GDP forecast due to factors such as low domestic demand and high gas and electricity prices impacting exports. These leading economic think tanks issued their biannual “collective diagnosis” of the German economy, revising their previous growth forecast from 1.3% to just 0.1%. The report highlighted the importance of consumer purchasing power in improving the economic outlook.

According to the report, the German economy is experiencing weakness with growth forces dwindling. Economic and structural factors are contributing to sluggish overall economic development. While a recovery is expected to start in the spring, the momentum is not anticipated to be significant. Experts pointed out that domestic demand did not rise as projected, partly due to high energy prices making energy-intensive goods less competitive, despite being a strength of the German economy.

Another factor affecting the German economy is the government’s strict fiscal policy, which is preparing to adhere to the constitutional debt brake regulations limiting new debt issuance. As a result, Germany had the lowest-performing major economy worldwide last year. Nonetheless, growth is expected to improve in the coming year, with a forecast predicting a 1.4% increase. The collaborative report was compiled by five economic research institutes in Germany: DIW in Berlin, IfW in Kiel, IWH in Halle, RWI in Essen, and Ifo in Munich

By Samantha Nguyen

As a content writer at newsqwe.com, I am passionate about crafting engaging and informative articles that captivate our audience. With a background in journalism and a keen eye for detail, I strive to deliver content that is not only well-researched but also adds value to our readers' lives. From breaking news stories to in-depth features, I take pride in my ability to tell compelling stories that resonate with our diverse audience. When I'm not typing away at my keyboard, you can find me exploring new cafes, practicing yoga, or getting lost in a good book. I am thrilled to be a part of the newsqwe.com team and look forward to sharing my love for writing with all of our readers.

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