Analysis: The German Institute for Economic Research has revised down its economic growth forecast for 2027.

The German Institute for Economic Research predicts that the German economy will grow by 0.8% this year and next year. Earlier, this research institution based in Munich predicted a growth of 0.8% for this year and 1.2% for 2027. "This forecast is based on the assumption that the conflict will de-escalate in the coming weeks and the Strait of Hormuz will reopen. It is expected that energy prices will gradually decrease afterwards, but will still be higher than pre-war levels by the end of the forecast period." The German Institute for Economic Research stated that the global economy is expected to grow by 2.2% in 2026 and by 2.4% in 2027, with the global trade growth rate slowing down from 3.0% to 2.0%. Additionally, the overall inflation rate in Germany is expected to be 2.9% in 2026 and will fall to 2.7% in 2027.