Published by Global Banking & Finance Review®
Posted on October 15, 2025
1 min readLast updated: January 21, 2026
Add as preferred source on GoogleThe German economy is expected to grow slightly in Q4 2025, with a 34.8% recession probability, as per the IMK indicator.
BERLIN (Reuters) -The German economy will grow slightly in the final quarter of 2025, according to an indicator of the Macroeconomic Policy Institute (IMK) at the Hans Boeckler Foundation seen by Reuters on Wednesday.
The indicator - which aggregates the latest available data on key economic variables - shows a recession probability of 34.8% and therefore does not point to acute contraction risks.
German exports unexpectedly fell in August on a sharp decline in U.S. demand, industrial output posted its biggest decline in more than three years and German industrial orders fell for a fourth straight month in August.
"In recent weeks we have seen some bad economic news, especially regarding weak exports to overseas markets. That is, of course, relevant but fortunately foreign trade isn't everything," said Sebastian Dullien, research director at IMK.
"What is clear, however, is that in the coming months the German economy cannot hope, as in the past, to be pulled out of crisis by exports," he said, adding that there is hope for a domestically driven upswing.
(Reporting by Maria Martinez and Klaus Lauer, Editing by Friederike Heine)
Economic growth refers to the increase in the production of goods and services in an economy over a period, typically measured as the percentage increase in real GDP.
A recession is a significant decline in economic activity across the economy, lasting longer than a few months, typically reflected in GDP, income, employment, manufacturing, and retail sales.
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