Initially, economists anticipated growth rates of 1.3 to 1.4 percent; however, the revised outlook indicates a significant decline. The Ifo Institute’s chief economist, Wollmershäuser, noted that while expansive fiscal policy supports domestic demand, rising inflation—projected at 2.8 percent for 2026—will dampen private consumption. The report advises against government interventions for lower energy prices, advocating instead for targeted social compensation measures. Federal Minister of Economics, Reiche, emphasized the urgent need for structural reforms in light of these developments.