Germany cuts 2026 growth forecast, raises inflation

Germany's economy ministry has significantly reduced its growth projections for both 2026 and 2027, signaling a more challenging economic outlook. Concurrently, the ministry has revised its inflation forecasts upward, indicating persistent price pressures. These adjustments are largely attributed to the ongoing geopolitical tensions, specifically the impact of the Iran war on global oil and gas prices. The revised outlook suggests that Europe's largest economy will face headwinds from both slower expansion and higher living costs in the coming years.