FILE PHOTO: People with protective face masks walk at Kurfurstendamm shopping boulevard, amid the coronavirus disease (COVID-19) outbreak in Berlin, Germany, December 5, 2020. REUTERS/Fabrizio Bensch
January 21, 2022
BERLIN (Reuters) -The German government will cut its economic growth forecast for this year to 3.6% from its October estimate of 4.1%, two sources familiar with the matter told Reuters on Friday.
The revised forecast is due to supply bottlenecks for products such as semiconductors and a fourth wave of coronavirus infections, said Der Spiegel, which reported the news first.
The magazine cited the government’s annual economic report due to be presented by Economy Minister Robert Habeck next week.
The cabinet is due to approve the annual economic report for the year with a new forecast on Wednesday. A forecast for 2023 is not planned.
The economy ministry declined to comment.
Most economists expect the German economy to shrink again in the first three months of 2022, driving it into another technical recession, defined as two consecutive quarters of contraction.
Germany’s BDI industry association said earlier this month it expected the German economy to grow 3.5% this year, giving a more cautious forecast than the government as it warned that companies could face another year of “stop-and-go” business due to the pandemic.
(Reporting by Christian KraemerWriting by Riham AlkousaaEditing by Miranda Murray)
