German IWH institute cuts German 2021 GDP forecast

FILE PHOTO: The skyline with its financial district amid the outbreak of the coronavirus disease (COVID-19) in Frankfurt
FILE PHOTO: The skyline with its financial district is photographed during sunset as the spread of the coronavirus disease (COVID-19) continues in Frankfurt, Germany, October 26, 2020, REUTERS/Kai Pfaffenbach

March 11, 2021

BERLIN (Reuters) – Germany’s IWH economic institute on Thursday cut its 2021 growth forecast for Europe’s largest economy to 3.7% from 4.4% in December as the country risks a third wave of the coronavirus pandemic.

“Especially for Germany, there is a danger that the steps decided at the beginning of March to open up (the economy) will trigger a third wave of infection,” the Halle-based institute said.

The institute was nonetheless more upbeat about the economy’s prospects this year than the government, which is forecasting 2021 growth of 3%, after a 4.9% slump last year.

Germany’s Robert Koch Institute (RKI) has warned of the risk of a third wave of coronavirus infections in Germany.

(Reporting by Rene Wagner; Writing by Paul Carrel; Editing by Maria Sheahan)