The German economy will continue to stagnate in winter 2024/2025. Industry is suffering from a loss of international competitiveness. For this reason and due to the unclear economic policy outlook, firms and consumers are holding back on spending, although incomes have increased recently. Consumer spending will only increase more strongly once the uncertainty subsides. According to the winter forecast of the IWH, gross domestic product in Germany is expected to fall by 0.2% in 2024 and to expand by 0.4% in 2025. In September, the IWH forecast had still assumed a zero growth in 2024 and a growth of 1.0% in 2025. In East Germany, gross domestic product will increase by 0.5% both this year and in 2025.

At the turn of the year, global production should continue to expand at roughly the same rate as in the decade before the pandemic. The economy remains remarkably robust in the US, but performs only modestly in the euro area. In China, a property crisis continues to weigh on residential construction and the finances of households, firms and regional authorities. The US president-elect is expected to at least partially fulfil his campaign promise of tariff increases in 2025. This will result in higher prices and a more restrictive monetary policy in the US, because output is already at more than full capacity. The consequences for global trade and German exports will be negative, and the international division of labour will become less efficient. In the short term, however, trade and production are likely to benefit from attempts to pre-empt tariff increases by concluding deals quickly.