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Exclusive-Germany cuts 2022 economic growth forecast to 2.2%


© Reuters. FILEPHOTO: A cordoned off area is used by people to eat outside in the restaurant located on Soest’s historical main square, Germany. This was May 12, 2021. REUTERS/Wolfgang Rattay

BERLIN, (Reuters) – The German government has reduced its forecast growth for Europe’s largest economy in 2022 from 3.6% to 2.2% amid war in Ukraine.

The source stated that growth will pick up to 2.5% by 2023.

Two years ago, Germany’s economy was devastated by the coronavirus pandemic. The war in Ukraine created new threats for the German economy. According to the forecast, this could have an impact both on supply and price chains.

According to the source, concerns about high energy prices and energy scarcity could further dampen economic growth. Russia has been heavily sanctioned after its invasion of Ukraine. This war has pushed up energy prices around the world, sending them soaring.

Europe’s governments had hoped for a strong recovery following the coronavirus outbreak, but Russia’s incursion has put that in doubt.

On Wednesday, the German government will present updated economic forecasts.