The Ifo institute now expects German output to rise by just 0.2% in 2024 having previously pencilled in 0.7%
Germany is stuck in a ‘winter recession’ and growth in 2024 will be weaker than feared, say two of its leading forecasters.
The Ifo institute now expects output to rise by just 0.2 per cent having previously pencilled in 0.7 per cent, while the IfW Kiel institute slashed its forecast from 0.9 per cent to 0.1 per cent.
‘The economy is paralysed,’ said Ifo head of forecasts Timo Wollmershaeuser.
He added: ‘If you look at surveys of companies and households, you realise that the mood is poor and uncertainty is high.
Consumer restraint, high interest rates and price increases, the government’s austerity measures and the weak global economy are currently dampening the economy in Germany and leading to another winter recession.’
The German economy shrank by 0.3 per cent in the final three months of 2023 and it is expected to contract again in the first quarter, according to Wollmershaeuser.
Two consecutive quarters of falling output are defined as a technical recession.
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