The German economy is expected to grow at a slower pace than previously expected for 2022, due to the economic consequences of the war in Ukraine, the Ifo Institute stressed.
The German institute cut German growth estimates to 2.5% from 3.1% previously, while revising inflation estimates to 6.8% from 5.1%.
“At the beginning of the year, high prices led to a loss of purchasing power among households and, in turn, to a reduction in the consumption of goods,” said Ifo economist Timo Wollmershaeuser.
Commodity prices and supply problems are expected to decline gradually in the second half of the year, he said, with Ifo predicting that German growth will reach 3.7% in 2023.
Source: Capital
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