Germany's Kiel Institute for World Economics raised the 2026 growth forecast for Europe's largest economy by 0.5 percentage points on Thursday. The agency said there are more and more signs that the German economy has passed the low point of the downturn cycle and is regaining growth momentum. The Institute currently expects Germany's GDP to grow by 1.3% this year, compared with the previous forecast of 0.8%. The report points out that despite facing geopolitical headwinds, economic activity has clearly accelerated and business sentiment has improved. However, the agency warned that the foundation for recovery is not yet stable, that the war in Iran poses risks, and that fiscal stimulus policies will gradually be withdrawn in the next few years. For 2027, the Institute maintains the 1.0% growth forecast; the economic growth rate is expected to be only 0.5% in 2028.

Germany's Kiel Institute for World Economics raised the 2026 growth forecast for Europe's largest economy by 0.5 percentage points on Thursday. The agency said there are more and more signs that the German economy has passed the low point of the downturn cycle and is regaining growth momentum. The Institute currently expects Germany's GDP to grow by 1.3% this year, compared with the previous forecast of 0.8%. The report points out that despite facing geopolitical headwinds, economic activity has clearly accelerated and business sentiment has improved. However, the agency warned that the foundation for recovery is not yet stable, that the war in Iran poses risks, and that fiscal stimulus policies will gradually be withdrawn in the next few years. For 2027, the Institute maintains the 1.0% growth forecast; the economic growth rate is expected to be only 0.5% in 2028.