German government: Tariff impacts may lead to stagnation of the German economy this year.

On April 24, the German government lowered its economic growth forecast on Thursday and now expects the economy to stagnate rather than grow by 0.3% in 2025, as uncertainty over the global trade dispute will hinder economic growth and dampen investment. Germany is the only G7 economy that has not grown in the past two years, and Trump’s tariffs could see Europe’s largest economy go without growth for the third consecutive year for the first time in history. Germany’s export-oriented economy is already mired in weak global demand for its products and foreign companies weakening its competitiveness. In 2026, the German government expects the economy to grow by 1%, slightly lower than the 1.1% forecast in January, and expects the economy to grow under Chancellor-designate Merz. After falling by 1.1% in 2024, exports are expected to fall by 2.2% this year and grow by 1.3% tomorrow.