Germany will be the only major European country to plunge into a recession this year, according to the new forecasts by the European Commission.
The executive arm of the European Union expected the bloc to record a 0.4% contraction in economic activity this year, which was 0.6 percentage points lower than the previous estimate in May. The new forecast was slightly above the prediction by the International Monetary Fund in July that saw the largest economy in Europe contracting 0.3% this year.
More importantly, the commission also cut Germany’s growth expectations in 2024 to 1.1% from 1.4%.
Germany has been struggling after the bloc cut reliance on Russian energy in the wake of the Ukraine invasion.
Economists have been crowning Germany as “The Sick Man of Europe,” which indicates the country in the bloc that is experiencing economic difficulties.
Latest economic data from Germany showed that its manufacturing activity fell at the fastest pace since June 2009, excluding the Covid period.