The International Monetary Fund (IMF) revised its growth forecasts for Germany downwards to 1.2% this year and 0.8% in 2023, as Russia’s invasion of Ukraine has put a brake on the post-pandemic economic recovery in the past. country.
In May, the Fund expected the Gross Domestic Product (GDP) of Europe’s largest economy to increase by 2% in 2022 and grow slightly above 2% in 2023, after expanding by 2.9% in 2019.
The latest figures from the IMF, based on a recently completed annual consultation with Germany, are grimmer than those estimated by the German central bank (Bundesbank), which in June predicted growth of 1.9% and 2.4% in 2022 and 2023, respectively.
The IMF pointed to high energy cost inflation as a brake on growth, with prices expected to rise 7.7% in 2022 and 4.8% in 2023.
“Uncertainty is very high, with risks to the base-case growth forecast slanted down and risks to the inflation forecast slanted up,” the Fund said in a statement.
“The biggest threat is a persistent shutdown of remaining Russian gas exports to Europe,” he added.
In addition to the conflict, the IMF has warned that the resurgence of Covid-19 infections could also harm German growth by intensifying supply chain disruptions.
Source: CNN Brasil
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