Finance
German economy expected to contract by 0.3% this year, DIHK says
Published by Global Banking & Finance Review®
Posted on May 27, 2025
2 min readLast updated: January 23, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on May 27, 2025
2 min readLast updated: January 23, 2026
The German economy is forecasted to contract by 0.3% in 2023, according to DIHK, marking a third consecutive year of decline. Exports are also expected to fall.
By Maria Martinez
BERLIN (Reuters) -The German economy is expected to contract by 0.3% this year, shrinking for a third consecutive year, the German Chamber of Commerce and Industry (DIHK) said on Tuesday, forecasting the longest period of weakness in Germany's post-war history.
The risk of recession persists, the DIHK said, but following a promising first quarter, its forecast was more optimistic than the previously forecast 0.5% contraction published in February.
Economic growth in the first quarter was significantly stronger than expected due to export and industry frontloading ahead of U.S. tariffs.
Germany had been expected to be badly affected by tariffs due to its export-oriented economy. The U.S. was Germany's biggest trading partner in 2024 with two-way goods trade totalling 253 billion euros ($288.02 billion).
The DIHK forecasts German exports to decline by 2.5% in 2025, also contracting for a third consecutive year.
A DIHK survey, conducted among 23,000 companies from all sectors and regions, showed that 29% of the companies expect exports to fall over the next 12 months, while only 19% expect exports to rise.
($1 = 0.8784 euros)
(Reporting by Maria Martinez and Christian Kraemer, Editing by Rachel More)
The German economy is expected to contract by 0.3% this year, marking a third consecutive year of shrinkage.
The DIHK's current forecast is more optimistic than the previously predicted 0.5% contraction published in February.
Economic growth in the first quarter was significantly stronger than expected due to export and industry frontloading ahead of U.S. tariffs.
The DIHK survey revealed that 29% of companies expect exports to fall over the next 12 months, while only 19% anticipate an increase.
The DIHK forecasts a 2.5% decline in German exports for 2025, continuing a trend of contraction for a third consecutive year.
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