The German economy is in bad shape… looking to see what 2024 will hold
The German government has reduced its economic forecasts for 2023, anticipating a recession and a decline in GDP by 0.4%.
German Economy Minister Robert Habeck stressed that the economic situation is difficult as a result of the energy price crisis, the need of the European Central Bank to combat inflation, and the weakness of important global economic partners such as China.
Habeck noted that the expected recovery will be supported by a gradual decline in the inflation rate, as it’s expected to reach 2.6% in 2024, then decline to 2.0% in 2025 after rising to 6.1% this year.
The German economy recovery is likely to be supported by the labor market, which will remain strong.
It’s worth noting that there are disagreements within the ruling coalition in Germany regarding alleviating the burdens of companies affected by the rise in electricity prices at the global level.
These disagreements include Habeck’s proposal to provide government support for electricity prices in the industrial sector, which raises controversy within the coalition.
