German economy: the Bundesbank lowered its growth forecast to 0.2% in 2025

The Bundesbank has significantly worsened the forecast for the German economy for 2025, highlighting increased uncertainty associated with a potential increase in trade protectionism. According to the updated data, the country's GDP will increase by only 0.2% in 2025, although growth of 1.1% was previously forecast.

In 2024, the German economy is projected to decline by 0.2%, instead of the previously expected growth of 0.3%. If the forecasts come true, this will be the second consecutive year of economic recession.

Bundesbank President Joachim Nagel stressed that the German economy is facing constant economic challenges and structural problems, which are especially noticeable in industry, exports and investments. He also expressed concern about the possible intensification of trade protectionism and geopolitical conflicts, which could slow economic growth and increase inflation.

As a major exporter, Germany may suffer from a possible increase in US import duties. This may weaken the industrial sector, which has not yet reached the pre-crisis levels of production. According to the Bundesbank, German GDP is expected to grow by 0.8% in 2026 and by 0.9% in 2027.