Business in a descent: Federal government drastically lowers growth expectations!

Business in a descent: Federal government drastically lowers growth expectations!

The Federal Government drastically corrected its business forecast for 2023: Instead of an expected slight growth of 0.3 percent, a decline in gross domestic product is now calculated by 0.2 percent. Minister of Economics Robert Habeck confirmed in Berlin that this adaptation was not surprising in view of the latest developments in the economic situation and global uncertainties. Renowned economic research institutes also share this dark view and predict a minus of 0.1 percent.

The causes of the pessimistic assessment lie in high interest rates and the reserved willingness to invest in companies and private households. Because of these uncertainties, consumers prefer to put their money aside instead of investing in consumption or in real estate. Optimism for 2024: The federal government expects growth of 1.1 percent if the private consumption attracts and industry will become active again. However, there are concerns whether the planned growth package is sufficient with tax reliefs and work incentives to quickly revitalize the economy. The impending budget negotiations could also be burdened by the weak forecasts, since lower tax revenue and increasing social costs are on the agenda. More details on this development can be found in a report www.antennemuenster.de .