The four institutes – the RWI in Essen, the DIW in Berlin, the Ifo in Munich and Halle’s IWH – are expected to release their joint forecast on Thursday.
They will also raise their forecast for growth next year to 4.8% from 3.9%, and will project 1.9% economic growth for 2023, the two people said.
If the institutes’ new forecast proves correct, it will put a dent in overall euro zone growth prospects. Up to now, the European Commission has been upbeat on 2021 growth and had been hinting it would raise its 4.8% forecast for this year rather than cut it. Its new estimate is due for publication early next month.
On Tuesday, the International Monetary Fund cuts its 2021 growth forecast for Germany by half a percentage point from its July prediction to 3.1%.
Germany GDP slumped by 4.6% in 2020 due to the coronavirus pandemic.
Statistics office data showed last week that the volume of exports fell in August for the first time in 15 months, slipping unexpectedly as the supply chain issues plaguing the global economy continued to bite.
The German government, which so far has been forecasting growth of 3.5% for this year and 3.6% for next, is expected to update its estimates this month as well.
Official data on third-quarter economic growth is due on Oct. 29.
Source: Economy - investing.com
