Germany's Economic Forecast Takes a Downturn

The German government, now in its final days, has revised its economic outlook for 2025, predicting a period of stagnation. This marks an unprecedented moment in the nation's history, with the economy potentially not growing for three years in a row, as reported by Handelsblatt.

Revised Growth Projections

Initially, the government had anticipated a modest growth rate of 0.3% for the year. However, recent developments have led to a more pessimistic view. For 2026, the forecast suggests a GDP growth of around 1%, slightly lower than previous estimates by 0.1 percentage points.

The Impact of Global Trade Policies

The primary factor behind this adjustment is attributed to the recent tariffs and unpredictable trade policies announced by U.S. President Donald Trump. These measures have created a climate of uncertainty, causing German businesses to delay investment decisions.