For the coming year, the Ifo Institute expects a decline in economic output and even higher inflation. But according to the economic forecast, there is light at the end of the tunnel.
The Munich-based Ifo Institute expects prices to continue to rise and economic growth to remain weak well into the coming year.
“We’re going into a winter recession”said the head of economic forecasts, Timo Wollmershäuser, on the occasion of the presentation of the forecast for autumn 2022. According to this, the researchers assume that the economy will grow by only 1.6 percent this year and inflation by 8.1 percent remains at a high level.
The economy is not expected to pick up again until 2024
The forecast for the coming year is even bleaker: the institute even predicts a 0.3 percent contraction in economic output and a 9.3 percent inflation rate.
According to the study, recovery can be expected in the following year. “Only in 2024 do we expect normalization with 1.8 percent growth and 2.5 percent inflation”Wollmershäuser continues.
The reason for the high price increases are, among other things, the costs for electricity and gas. “As a result, real household incomes fell sharply and purchasing power fell noticeably. The government’s third relief package should counteract this decline somewhat, but by no means offset it”, according to the study. The researchers do not expect energy prices to fall until spring 2023. For its calculations, the Ifo Institute assumes that there is enough gas available in winter.
But despite all the sadness, there is also good news: the Ifo Institute does not expect the situation to have a serious impact on the labor market. It expects 50,000 more unemployed in the coming year. The increase is mainly due to people from Ukraine, who are only gradually being integrated into the labor market.
Sources: DPA news agency
Source: Stern
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
