Germany cuts 2026 Growth forecast to 0.5% (prev. 1.0%), cuts 2027 growth to 0.9% (prev. 1.3%), sees inflation at 2.7% in 2026, 2.8% in 2027

Germany's revision of its growth forecasts indicates a significant deterioration in economic outlook, cutting the 2026 growth to 0.5% and 2027 to 0.9%. These lowered expectations may point to challenges in underlying economic conditions and could have implications for ECB policy, especially with inflation remaining elevated at 2.7% and 2.8% for the same years, suggesting a delicate balance between growth and inflation management.