Germany growth forecasts slashed as Mideast war hits economy

German economic institutes have significantly reduced their 2026 growth forecast to 0.6%, citing the severe energy price shock caused by the Middle East conflict, which is expected to strain household purchasing power and weaken consumer spending. This development underscores the critical impact of geopolitical events on European economies, particularly those reliant on oil and gas imports, highlighting the need for robust economic policies to mitigate such shocks.

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