RWI Cuts Germany's 2026-2027 Growth Forecast to 0.8% on Energy Shock, Inflation to Hit 3.1%

According to RWI, Germany's economic growth forecast for 2026 and 2027 was revised down to 0.8% on June 16, citing energy price surges linked to Iran tensions as a key headwind. The research institute expects consumer price inflation of 3.1% in 2026 and 2.9% in 2027, as rising oil, fuel, and transport costs transmit through the broader economy. RWI chief economist Torsten Schmidt said rising costs are increasingly spreading along the value chain across goods and services. The institute projects Q2 2026 economic stagnation as persistent inflation erodes household purchasing power, though industrial output and exports remain relatively resilient.
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