Because private consumption has not yet supported the economy, the institutes expect a recession in 2023.
(Photo: dpa)
Berlin Two leading German economic research institutes expect the German economy to shrink in the current year. The German Institute for Economic Research (DIW) assumes a decline in gross domestic product (GDP) of 0.2 percent compared to the previous year. The Kiel Institute for the World Economy (IfW) lowered its outlook to minus 0.3 percent.
Both institutes presented their new economic forecasts on Thursday. The economists had previously expected slight growth for 2023.
According to the researchers, persistently high inflation and the resulting lower purchasing power of households in particular should also slow down the German economy. For the year as a whole, they are forecasting consumer prices to rise by 5.9 and 5.8 percent respectively. Other sectors cannot compensate for this. In industry, for example, the situation is also deteriorating.
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