FRANKFURT (Reuters). – The Bundesbank stated Friday that supply chain bottlenecks in Germany and new restrictions relating the COVID-19 pandemic would impede growth around the turning of the year. It will also delay Europe’s recovery.

Germany’s huge industrial sector, which has struggled with rising demand, is now unable to supply it. The bottlenecks could last into next year pushing for what was expected be a solid rebound.

In a biannual update to its economic forecasts, the central bank declared that the German economy would suffer in the fourth quarter of 2021 as well as the first quarter in 2022 because of the pandemic. However, it will recover substantial momentum in spring 2019.

“Pandemic-related supply restrictions and bottlenecks in intermediate goods may stall growth during the last quarter of 2021, and the first quarter 2022 respectively. However, private consumption should rise significantly starting in spring.”

According to the bank’s current forecasts, German growth will be at 4.2% in 2022. This is lower than the 5.2% predicted six months prior and below the 4.6% anticipated by the European Commission.

However, growth for 2023 has been estimated at.2%. This is almost twice the June forecast of 1.7%. It suggests that expansion may be delayed and not lost.

Also, inflation projections were revised upward.

In the Bundesbank projections, price growth should remain at or above the European Central Bank’s target of 2% throughout 2019.

The German central bank stated that consumer price inflation now stands at 3.6% in 2022. This is double what was projected six months back, and before falling to 2.2% in 2023, 2024.