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Euronews
Euronews
Maja Kunert

Iran war pushes Germany's deficit to 4.2% as growth outlook is cut by 50%

Germany Iran Deficit Bundesbank Katherina Reiche GDP Economy the Iran war

The Iran war is hitting the German economy at the worst possible time. Having only just fought its way out of a multi-year downturn, Europe's largest economy is now facing a new external shock — and the picture painted by leading researchers is one of structural exhaustion.

The country's top economic research institutes have more than halved their growth forecasts for 2026 in their Spring 2026 Joint Economic Forecast, published Wednesday.

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