Germany prepares to enter recession this winter, due to the harsh impact of the energy crisis on households and businesses, according to forecasts by the IFO institute and the German central bank.
“The reductions in gas supply from Russia during the summer and the drastic increases in prices that they caused are wreaking havoc on the economy,” summarized the IFO institute on Monday, one of the most influential in the leading European economy.
The agency reduced its growth forecast made in June by four percentage points, and now forecasts a decline of 0.3% of GDP in 2023.
It is the first German institute to forecast a drop in GDP next year.
The IFO predicts a technical recession in the first quarter of 2023with a fall of 0.4% of GDP, after a decline of 0.2% in the fourth quarter of 2022.
The day before, the president of the influential German central bank, Joachim Nagel, already released a similar forecast and declared that a recession was “possible” at the end of this year and early 2023.
“There are a certain number of elements” that point to this hypothesis, he said on public radio.
According to the IFO, the situation could “normalize” in 2024 with “1.8 percent growth.”
We are heading towards a winter recession,” summarized Timo Wollmershäuser, director of conjunctural studies at this institute.
Refering to inflation, should reach 9.3% next year, after reaching 8.1% in 2022, according to the agency. The Federal Bank forecasts inflation to “more than 10%” in December, and to “more than 6%” in 2023.
The Russian invasion of Ukraine and the sanctions imposed by the European Union on Moscow have caused the Russian giant Gazprom to drastically reduce its gas deliveries to Germany until supply is completely interrupted in September.
Germany, highly dependent on Russian gas, now has to look for other, much more expensive suppliers.
This situation has triggered the price of gas and electricity in the country, which was already very high in full economic recovery after the pandemic of Covid-19.
[ad_2]
hartford car insurance shop car insurance best car insurance quotes best online car insurance get auto insurance quotes auto insurance quotes most affordable car insurance car insurance providers car insurance best deals best insurance quotes get car insurance online best comprehensive car insurance best cheap auto insurance auto policy switching car insurance car insurance quotes auto insurance best affordable car insurance online auto insurance quotes az auto insurance commercial auto insurance instant car insurance buy car insurance online best auto insurance companies best car insurance policy best auto insurance vehicle insurance quotes aaa insurance quote auto and home insurance quotes car insurance search best and cheapest car insurance best price car insurance best vehicle insurance aaa car insurance quote find cheap car insurance new car insurance quote auto insurance companies get car insurance quotes best cheap car insurance car insurance policy online new car insurance policy get car insurance car insurance company best cheap insurance car insurance online quote car insurance finder comprehensive insurance quote car insurance quotes near me get insurance