German institutes cut growth forecast as Iran war drives inflation higher - Reuters

<a href="https://news.google.com/rss/articles/CBMivgFBVV95cUxQN0JuN3dMdXNmZk52M084eS1yQUNkN0s3UVNfSmlFV1pNV0poSzV3S1otd0ZaZ2t0eUduWHhpdVNUcVJLQ3V4cUZFZWdaZEtxS0ZKZ1VVczdvVGlFQWxoTEE3d2dCbTJSRnFIVk9UVkdGYmFHNlhBbHdvWmxvbHJfT2xpbUtDQjBfd3pFWXhxUWN2WEdtZVhrVl9OZ1I3T3MzeUN5UHBCanAtYWxzZDE3bFo0WkR0RkJkZTQ3dWFB?oc=5" target="_blank">German institutes cut growth forecast as Iran war drives inflation higher</a>&nbsp;&nbsp;<font color="#6f6f6f">Reuters</font>

Germany's leading economic institutes have more than halved their 2026 economic growth forecast, slashing it to 0.6% from the 1.3% projected in September, as rising energy costs linked to the Iran war fuel inflation. The institutes also lowered their 2027 growth outlook to 0.9% from a prior estimate of 1.4%.

Germany's economic growth forecast for 2026 and 2027 has been significantly reduced due to the economic consequences of the ongoing Iran war, with GDP growth now projected at 0.6% for 2026 and 0.9% for 2027. The conflict has led to rising energy prices, particularly due to the disruption of the Strait of Hormuz, pushing eurozone inflation to 2.5% in March, up from 1.9%.

Eurozone annual inflation surged to 2.5% in March, up sharply from 1.9% in February, driven by a 4.9% increase in energy prices due to the Iran war and the near-total closure of the Strait of Hormuz. Economists are debating whether the European Central Bank will raise interest rates in response.