OECD Slashes Germany's 2025 Growth Forecast to 0.7%

Germany is projected to have the slowest economic growth among OECD nations, driven by weak exports, fiscal constraints, and investor uncertainty.

The OECD has revised Germany's 2025 economic growth forecast downward to 0.7%, making it the lowest among its 38 member nations.
Germany's economy is expected to stagnate in 2024, with a modest recovery projected at 1.2% growth in 2026.
Key factors for the sluggish growth include reduced export demand from China and competition from Chinese products, which heavily impact Germany's industrial sector, particularly automotive manufacturing.
Germany's restrictive fiscal policies, including the reinstatement of the debt brake and reduced public spending, have further constrained economic activity.
Uncertainty over the unresolved 2025 federal budget and the financing of climate and transformation projects has eroded business and consumer confidence.