The Institute for Economic Research in Germany (RWI) lowered its economic forecasts, and announced, on Thursday, expectations of a decline in economic performance in Germany for this year.
While the institute’s researchers expected a growth of 0.2% last March, they now expect a decline of 0.3%.
On the other hand, the institute expects a strong increase in 2024, as it has now revised its forecast for the next year to increase by 2.0% instead of 1.8%.
The Essen Institute announced last week that according to the current weak economic demand in Germany, this could be due in particular to a strong decline in private consumption.
The institute stated that in light of the rise in inflation at the beginning of this year and the resulting decline in real income, people limited their consumption, and added, “In the rest of the year, people’s consumption expenditures may rise again”.
According to the Institute’s expectations, the inflation rate this year will be 5.5%, and it will decline next year to 0.2%.