The Hausblick

Research evidence excerpt

The Hausblick

At a Glance

– Geopolitical risks have recently subsided but remain a key source of uncertainty. The full impact of the

shock may still feed through to supply chains with a lag.

– Nevertheless, the global economy should prove resilient in 2026, with growth of 3.1%, supported by solid

US economic activity. By contrast, growth momentum in China and the Eurozone is likely to weaken.

Global – Persistent inflation pressures call for further monetary policy action. The ECB is expected to continue its

Economy tightening cycle, and the Fed is likely to deliver rate hikes in September and December.

– The energy price shock continues to dampen Germany’s economic recovery. Against this backdrop, we

expect GDP growth of 0.5% in 2026.

– The fiscal impulse should gain momentum in the second half of the year, providing further stabilization for

the German economy. The fiscal deficit could widen to 4.1% of GDP this year.

German – High uncertainty and low capacity utilisation continue to weigh on investment. In the construction sector,

Economy the recent decline in order backlogs also points to subdued investment activity ahead.

– Germany faces significant structural challenges. The federal government has already initiated several

reforms, while a further reform package was agreed ahead of the summer recess.

– The recently adopted Infrastructure Accelerator Act aims to significantly accelerate planning and approval

procedures, thereby accelerating the implementation of investment projects.

Structural – Demographic change is placing increasing pressure on the statutory pension system. The coalition plans to

Challenges implement the Pension Commission’s 33 recommendations in a legislative package by year-end.

Deutsche Bank.