German government: Economy to shrink in 2023 as war bites

By GEIR MOULSON
Associated Press

BERLIN (AP) — The German government has slashed its growth forecast for this year and predicted that Europe’s biggest economy would shrink in 2023 as Germany deals with the fallout from Russia’s war in Ukraine including Moscow cutting off natural gas supplies. The Economy Ministry said Wednesday that it expects Germany’s gross domestic product to grow by 1.4% this year and then decline by 0.4% next year. The ministry in late April had forecast 2.2% growth in 2022 that would accelerate to 2.5% next year. The impact of the war has deepened since then with energy prices stubbornly high and Germany’s annual inflation rate hitting 10% in September.