German inflation to stay high, growth has slowed, Bundesbank says
- The Bundesbank reported on Monday that the German economy lost momentum in the third quarter, with gross domestic product expanding only "slightly" after previous 0.3% growth.
- Weaker exports, consumption, and droughts weighed on activity, while short-term factors like low water levels in the Rhine river further restricted economic output.
- Inflation recently stood at 2.9%, and The Bundesbank warned it will "remain elevated for the time being" due to high energy costs linked to the Iran conflict.
- High living costs and a weak economy have become significant political issues, fueling voter dissatisfaction with mainstream parties across Europe.
- Business surveys suggest a brighter outlook for manufacturing, though healthcare reforms due at the start of 2027 are expected to temporarily lift inflation early next year.
21 Articles
21 Articles
The German economy is temporarily losing momentum, but growth could pick up again by the end of the year, according to the German central bank. According to the Bundesbank's monthly report for September, economic performance in the third quarter will be held back primarily by low water levels, high energy prices and subdued consumption, but it expects a more favorable outlook for the fourth quarter.
High energy prices, low consumption and the consequences of the low water burden the economy. However, the Bundesbank is more optimistic for the fourth quarter.
Zeit Online
The German central bank (Bundesbank) expects the economy to regain strong growth in the final quarter of the year, after growth slowed in the third quarter due to temporary factors. However, the bank warned that high energy prices could delay the return of inflation to 2 percent.
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