Frankfurt: A group of leading German economic institutes on Thursday slashed Germany’s GDP growth forecast to 2.4% this year, citing the coronavirus pandemic and problems with the global supply chain.
In a joint statement, the five economic institutes — DIW, Ifo, IfW, IWH and RWI — said the pandemic “still shapes the economic situation in Germany.”
The economists believe “contact-intensive activities” necessary for the economy are unlikely to resume in the short term, due to the pandemic.
The service sector, in particular, is expected to underperform as Germany heads into the winter, with supply chain bottlenecks also “hampering” manufacturing.
Production lines at major German automobile companies such as Volkswagen and Opel have been slowed down due to a global lack of semiconductors, for example.
The experts had previously predicted that the economy would grow by 3.7% this year.
The service sector, in particular, is expected to underperform as Germany heads into the winter, with supply chain bottlenecks also “hampering” manufacturing.
Production lines at major German automobile companies such as Volkswagen and Opel have been slowed down due to a global lack of semiconductors, for example.
The experts had previously predicted that the economy would grow by 3.7% this year.
