Germany lifts GDP forecast as economy withstands Iran war
AgenciesGermany on Thursday sharply raised its growth forecast for this year, saying Europe’s biggest economy had withstood the Iran war energy shock and was benefiting from the gl...
Germany raised its GDP forecast for 2025 on Thursday, citing the country's ability to withstand the energy shock caused by the Iran war and the global AI boom. The growth projection was increased to 1.3 percent, up from the April forecast of 0.5 percent. Economy Minister Katherina Reiche attributed the more robust outlook to the German economy's resilience in the face of geopolitical uncertainties, energy price shocks, and trade tariffs.
She emphasized that foreign trade, particularly in the months following the US war against Iran, provided a significant boost to the economy. German imports of goods such as steel, fertilizer, and aluminum surged after the conflict began, and the global trend of investment in artificial intelligence further supported German suppliers.
The ministry also raised its forecast for 2027 to 1.1 percent, citing a public spending blitz on defense and infrastructure. However, household consumption remained subdued due to higher energy costs pushing up consumer prices. German inflation reached 3.3 percent in September, the highest level in nearly three years. Officially, Germany's growth forecast for 2026 aligns with recent estimates from economic think-tanks.
Despite a fall in German exports in August for the second consecutive month, the German economy demonstrated resilience amid the Iran war energy shock.
Written by urgent.news from Qatar Tribune Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
