Bundesbank zur Konjunktur: Niedrigwasser bremst Erholung der Wirtschaft spürbar

The Federal Reserve Bank (Bundesbank) has stated that the drought and low water levels are temporarily slowing down the recovery of the German economy. According to the August monthly report, the economy may only see a slight increase in the third quarter. Limited water transport is causing delays in deliveries, rising transportation costs, and potential production slowdowns, which could significantly impact the already strengthening industrial cycle, according to the Central Bank economists.

The export sector, which has been a key driver of the unexpectedly robust mini-recovery of the German economy in recent months, may also face some hindrances due to the low water levels. This is dampening the overall economic activity in the third quarter: "The initially intended boost to economic momentum through foreign demand is largely impeded."

Rising prices are also putting pressure on private consumption. The persistent high energy prices, following the end of the fuel rebate in July, have caused the general inflation rate to jump to 2.8 percent and could potentially rise further in the coming months, according to the Federal Bank's assessment. In summary, the German economy has performed better in the first half of 2026 than expected, given the numerous crises.

The GDP grew by 0.2 percent in the second quarter compared to the previous quarter, according to preliminary calculations, indicating a clear upward trend in economic recovery, even in the face of the war in the Middle East. The German Federal Statistics Office will release fresh data on the development of the German economy in the spring.