Anticipates another year of economic downturn ruled by national administration
Germany's economic growth took a dip by 0.3% in 2023, as per initial reports. However, the official forecast for this year predicts a rise in the country's GDP. Yet, a newspaper article hints at a darker scenario, suggesting the government will soon share a new estimate.
Reports suggest the government has adjusted its economic prediction, anticipating a fifth consecutive quarter of recession in 2024. The Economic Ministry now projects a minor decrease of 0.2% in the GDP this year, as per "Süddeutsche Zeitung". Originally, the forecast for 2024 dispensed a 0.3% rise in GDP. Germany's economy faced a decline of 0.3% in the previous year as well. The fresh predictions are set to be unveiled on Wednesday. Notably, top research bodies have already revised their forecasts for the current year.
Economists' Autumn Report for the Government
In their latest report for the administration, economists forecast a 0.1% drop in the GDP in 2024, marking the second consecutive year of contraction. This consensus forecast lays the groundwork for the government's new estimates in October, which subsequently serve as a reference for the tax estimate.
Habeck sees a brighter future for Germany's economy
According to "Süddeutsche Zeitung", German Federal Minister of Economics, Robert Habeck, holds a more optimistic outlook for the next two years than initially projected. He envisions the economy to emerge from its current weakness and exhibit more vigor. His forecast for 2025 includes a 1.1% growth in GDP, slightly surpassing the previously assumed 1%. For 2026, he anticipates a 1.6% rise in the GDP. Leading research bodies, however, show less optimism, shaving their consensus forecast for 2025 from 1.4% to 0.8%, and predicting a growth of 1.3% for 2026.
The Economic Ministry's revised forecast for 2024 now predicts a minor decrease of 0.2% in Germany's GDP, contrasting the initial forecast of a 0.3% rise.Despite revised forecasts and suggestions of a fifth consecutive quarter of recession, Germany's official forecast for this year still predicts a rise in the country's GDP.
