KfW Business Cycle Compass May 2023

Germany is poised for an economic recovery with one foot on the brake. Supply shocks are dissipating but the dampening effects of monetary policy are increasingly showing results. KfW Research expects growth of -0.3% in Germany for 2023 as a whole, a virtual stagnation, followed by moderate growth of 1.0% in 2024. Euro area GDP is likely to grow 0.8% in 2023 and 1.1% in 2024. Inflation in both economies is set to drop significantly from around 6% this year and get close to the 2% target again in 2024.

KfW Business Cycle Compass May 2023(PDF, 196 KB, accessible)

Press release