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Global shortages crimp growth in powerhouse Germany

New forecasts from German leading economic institutes

14 October, 13:13
(ANSA-AFP) - FRANKFURT AM MAIN, OCT 14 - Global shortages in industrial components and raw materials have cramped Germany's export driven economy, prompting the country's leading economic institutes to slash their forecast for growth this year on Thursday. In their biannual forecast, the research groups revised down the estimate for 2021 to 2.4 percent, from their earlier prediction of 3.7 percent made in April. "The corona(virus) pandemic still shapes the economic situation in Germany," the institutes (DIW, Ifo, IfW, IWH and RWI) said in a joint statement, preventing a return to normal economic activity. After rapid growth in spring, the German economy had been held back by supply bottlenecks "hampering manufacturing" and meant that "only the consumer-related service industries are growing", the institutes said. Together the institutes expect pandemic effects and shortages to be "gradually overcome" in 2022, raising their forecast for growth in the year to 4.8 percent from 3.9 percent. (ANSA-AFP).

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