FRANKFURT, (Reuters) – Germans need to be prepared for lower prices and slower economic growth due to Russia’s invasion in Ukraine. This will disrupt trade and make fuel and wheat more costly.

The largest European economy paid a heavy price for its dependence on Russian gas. This price has skyrocketed since Russia invaded Ukraine last month, in what Russia calls “special military operations”.

The German central bank reported that “this should dampen household consume and production in the energy-intensive industry,” in its monthly report.

The German economy is likely to have stagnated over the first three-months of 2011, and its forecast for a rebound in the second quarter was now less probable due to “foreseeable impairments, foreign trade and greater uncertainty”.

The inflation rate, at 5.1%, reached its highest point in nearly 30 years, even with the recent surge in fuel prices. It was expected to continue rising.

The Bundesbank stated that the drop in wheat exports from Russia and Ukraine should give food prices and industrial goods a boost.