MADRID, 29 Sep. (EUROPA PRESS) -
Germany's leading economic forecasting institutes issued a joint report on Thursday forecasting an unprecedented 7.9% contraction in the country's gross domestic product (GDP) if a series of downside risks materialize.
"The reduced gas supply from Russia has eliminated a significant part of the supply and has increased the risk that the remaining and storage volumes in the winter will not be sufficient to meet demand," the Munich IFO institutes have warned, DIW from Berlin, IfW from Kiel, IWH from Halle and RWI from Essen.
In this way, in the most negative and risky scenario, in which the country fails to reduce its gas consumption, there is a shortage of supply and the winter is especially cold, the institutes estimate that the economy will fall by 7.9%. in 2023, while in 2024 another 4.2% will sink.
However, the base scenario is different. The institutes expect economic growth of 1.4% this year, compared to the 2.5% forecast three months ago, while a recession of 0.4% will be recorded by 2023. In June, they estimated growth of 3.7%. The outlook for 2024, the first to be done for that year, has been set at 1.9%.
In addition, within these base forecasts, the institutes consider that the average inflation in Germany for this year will be 8.4%. In 2023, due to the energy situation, it will accelerate further to an average of 8.8%, although by 2024 it will drop to 2.2%. It is a large difference compared to June, when the organizations forecast inflation of 6.8% this year and 3.3% in 2023.