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German Economy Likely to Grow Despite Iran War, Bundesbank Says
The central bank said strong exports, government spending and resilient consumers are offsetting weaker activity from the Middle East conflict.
- On Tuesday, the Bundesbank reported Germany saw modest economic expansion in the second quarter, continuing into the third despite headwinds from the Middle East conflict affecting energy and commodity costs.
- Manufacturers are benefiting from strong foreign demand and rising exports, while the Bundesbank noted consumers remain "relatively unfazed" by high energy prices, keeping consumption spending stable.
- Both the Bundesbank and the government forecast expansion of just 0.5% for the full 12 months; a separate Bundesbank study found red tape costs German firms about 7% of revenue annually.
- Economists polled by Bloomberg expect second-quarter GDP growth to slow to 0.1% from 0.3%, while the Bundesbank anticipates inflation will accelerate beyond the current 2.4% level in coming months.
- Chancellor Friedrich Merz, who predicted 2026 would be a "year of growth," faces a challenge with this forecast; the Bundesbank expects growth to accelerate to 0.8% next year, though war-related drag remains.
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The German economy grew minimally in the spring, despite the pressures of the Iran war.
·Germany
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German Economy Likely to Grow Despite Iran War, Bundesbank Says
·New York, United States
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Zeit OnlineReposted by 
INTELLINEWS
INTELLINEWSDespite Iran's war, the German economy grew slightly in the second quarter. According to the Bundesbank, this is due to growing industrial exports and stable consumer spending.
·Germany
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Total News Sources16
Leaning Left1Leaning Right3Center7Last UpdatedBias Distribution64% Center
Bias Distribution
- 64% of the sources are Center
64% Center
C 64%
R 27%
Factuality
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