CAPTION: German experts raise economic forecast after fears of recession. (picture alliance/dpa/Marcus Brandt)
Following fears of a looming recession, leading economic research institutes in Germany have raised their forecast for the current year, with the country's gross domestic product (GDP) now expected to grow by 0.3%.
Last autumn, the experts, including from the Munich-based Ifo Institute, had still expected a decline of 0.4%.
The economic setback in the winter months looks set to have been less severe that was initially feared in autumn, Ifo head researcher Timo Wollmershäuser said.
This was mainly due to a lower reduction in purchasing power due to a significant drop in energy prices.
However, Wollmershäuser said he only expected inflation rates to decline slowly, from 6.9% last year to 6% this year.
According to the forecast, inflationary pressure will only ease in the coming year, when the inflation rate is expected to fall to 2.4%. Germany's GDP meanwhile is expected to increase by 1.5% in 2024.
Germany's four leading economic institutes - the Ifo Institute, the Halle Institute for Economic Research, the Kiel Institute for the World Economy and the RWI–Leibniz Institute for Economic Research - issue their joint report twice a year, one in spring and one in autumn.
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