German government raises growth forecasts for 2026 and 2027
EWG•Germany raised its growth forecast to 1.3% for 2026, from 0.5% in April, and to 1.1% for 2027, from 0.9%. It expects inflation of 2.7% in 2026 and 3.0% in 2027.
1. Growth forecasts raised
The German government raised its forecast for economic growth to 1.3% in 2026 and 1.1% in 2027, compared with April forecasts of 0.5% and 0.9%. It expects growth of 0.6% in 2028. Economy Minister Katherina Reiche said the economy is growing, but that reforms are needed to turn the initial recovery into sustained momentum.
2. Inflation and exports
The government expects exports to grow 3.7% in 2026, then 2.1% in 2027 and 1.1% in 2028. It forecasts inflation of 2.7% in 2026 and 3.0% in 2027, easing to 2.2% in 2028; German inflation reached 3.3% in September.
3. Risks to recovery
The ministry said future economic developments will depend significantly on conflicts in the Middle East and Ukraine. A lasting resolution could accelerate the recovery, while persistent inflation could place a greater burden on businesses and households.
