Finance
US tariffs would eat up German growth this year and next, Bundesbank chief says
Published by Global Banking & Finance Review®
Posted on July 17, 2025
1 min readLast updated: January 22, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on July 17, 2025
1 min readLast updated: January 22, 2026
US tariffs may hinder German growth, warns Bundesbank. A 30% tariff on European goods could lead to recession, affecting transatlantic trade.
By Maria Martinez
DURBAN, South Africa (Reuters) -The Bundebank expects growth of 0.7% in Germany in 2026 but this could be eaten up if U.S. tariffs of 30% threatened by President Donald Trump were implemented, the central bank's President Joachim Nagel told Reuters in an interview.
"If tariffs materialise in August, a recession in Germany in 2025 cannot be ruled out," Nagel said in Durban, South Africa, where the meeting of G20 finance chiefs is taking place on Thursday and Friday.
The 30% tariff on European goods threatened by Trump would, if implemented, be a game-changer for Europe, wiping out whole chunks of transatlantic commerce and forcing a rethink of its export-led economic model.
"The outlook for the German economy has just improved, especially due to the fiscal program that has been announced and is now being implemented by the German federal government, which also sets the right accents: investments in infrastructure, in future technologies," Nagel said. "But this uncertainty could significantly weaken a positive outlook."
(Writing by Maria MartinezEditing by Madeline Chambers)
The Bundesbank expects growth of 0.7% in Germany in 2026.
If US tariffs of 30% materialize, a recession in Germany in 2025 cannot be ruled out.
The 30% tariff threatened by Trump would be a game-changer for Europe, potentially wiping out significant portions of transatlantic commerce.
The outlook for the German economy has improved due to a fiscal program announced and implemented by the German federal government.
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