Forecasts

Apr 18, 2013: An upwards tendency re-emerged in the German economy in spring 2013. The situation in the financial markets has eased thanks to subsiding uncertainty regarding the future of the European Monetary Union. The headwind in the world economy has also tailed off somewhat. The institutes expect gross domestic product in Germany to increase by 0.8% this year (68%-projection interval: 0.1% to 1.5%) and by 1.9% next year. The number of unemployed should continue to fall to an annual average of 2.9 million this year and 2.7 million in 2014. The inflation rate is expected to drop to 1.7% this year and edge up to 2.0% next year on the back of rising capacity utilisation. The public budget will be almost balanced in 2013 and should show a surplus of 0.5% in relation to gross domestic product in 2014 thanks to more favourable economic conditions. It is now time to readopt a longer-term approach to economic policy. Although structural adjustment processes implemented in the crisis-afflicted countries have started to deal with institutional problems in the euro area, they are far from resolved. The German public budget also faces massive long-term burdens related to demographic factors. Details

Apr 5, 2013: In Q4 2012, activity in the Eurozone contracted by 0.6% (-0.1% in the previous quarter). The decrease in exports put a drag on GDP growth while domestic demand remained on a negative trend. However, in the first quarter of 2013, the business climate has slightly improved. As a result, Eurozone activity is expected to turn positive in the second quarter: 0.0% in Q1, +0.1 % in Q2 and +0.2% in Q3. Exports are projected to accelerate, as demand from emerging markets will expand at an increasing pace, reflecting monetary and fiscal easing. Furthermore, GDP growth in the United States is also expected to be buoyant and support Eurozone exports. Details

Jan 9, 2013: GDP in the Eurozone contracted by 0.1% in Q3 2012 and business surveys as well as the decline of the industrial production in October suggest a further decrease of activity in Q4 (-0.4%). Details

Dec 19, 2012: The world economy has been steadily cooling down since mid-2011, which has led to a renewed intensification of the European debt crisis on the one hand, and is due to the restrictive monetary policy pursued by emerging economies on the other. This development has ultimately resulted in a clear deterioration in the economic situation in Eastern German and Saxon manufacturing. The overall economic dynamic has also slowed down strongly as a result. However, this does not mean that the economy of Eastern Germany (including Berlin) and Saxony is expected to slip into a recession. According to the current forecast of the Ifo Institute (Dresden branch), price-adjusted gross domestic product (GDP) in the Eastern German Länder looks set to increase by 0.2% in 2012 and by 0.5% in 2013; while economic activity looks set to pick up clearly over the course of the forthcoming year. In Saxony, which depends more strongly on international economic influences, economic development is expected to be slightly weaker than in Eastern Germany on the whole this year and slightly better next year. Details

Dec 13, 2012: The German economy looks set to contract in the fourth quarter of 2012, before staging a recovery that is expected to be modest initially in 2013. These are the indications of the Ifo Business Climate Index, which recently rose clearly after showing no signs of any upswing in the previous months. The euro crisis is responsible for the poor economic situation at present. Real gross domestic product, at a 2/3 uncertainty interval of -0.6 % to 2.0 %, should therefore only in-crease by 0.7 % on annual average in 2013. Boosted by domestic demand, the economy looks set to pick up again in the year ahead, as long as the European debt crisis does not escalate any further. However, no significant growth in employment is expected during this period. Details

Oct 11, 2012: The euro crisis is putting a strain on the German economy. Economic growth will therefore remain weak for the moment and only looks set to recover again slightly over the course of next year. The institutes forecast a 0.8% increase in gross domestic product for 2012 and a 1.0% increase for 2013. The situation in the employment market will deteriorate further, with the number of unemployed set to rise slightly to 2.9 million in 2013. The German state budget will be almost balanced both this year and in 2013. The institutes are critical of the ECB’s programme to purchase the government bonds of crisis countries. This will increase the danger of inflation. Details

Oct 5, 2012: As forecast in the previous EZEO, GDP in the Euro-zone contracted by 0.2% in Q2. It is expected to continue declining in Q3 (-0.2%) and Q4 (-0.1%) as ongoing fiscal consolidation and the still high level of uncertainty will be taking their toll on domestic demand. In Q1 2013 GDP will stagnate on the back of a moderate acceleration in external demand. Details

Jul 16, 2012: Details

Jul 4, 2012: Output in the Euro-zone is expected to decline in Q2 (-0.2 %) and Q3 (-0.1%) and to recover slowly in Q4 (0.1%). Global demand is projected to improve moderately and net exports to be the main driving force of the mild recovery over the forecast horizon. However, unfavorable labor market conditions and impacts of fiscal consolidation will continue to dampen household disposable income. Details

Jun 28, 2012: Details