German Industry Faces Stagnation in 2026, BDI Warns
Germany's BDI industry lobby warned that German manufacturing faces stagnation in 2026, citing US tariffs, elevated energy costs stemming from the Iran war, and weakening global demand as the key headwinds. The warning comes as German producer prices fell 0.2% in March, reflecting subdued factory-gate inflation but also weak pricing power.
Germany's BDI industrial lobby issued a stark warning on Monday that German manufacturing output could flatline in 2026, as the industry grapples with a triple headwind of US import tariffs, surging energy costs linked to the Iran conflict, and softening demand from key trading partners. The lobby called on Berlin to accelerate structural reforms and reduce the economy's dependence on expensive imported energy.
Separate data showed German producer prices fell 0.2% year-on-year in March, beating forecasts for a larger decline but still signalling that factory-gate deflationary pressure has not fully abated. Weak pricing power at the producer level is squeezing industrial margins and complicating investment decisions for manufacturers.
As Europe's largest economy, Germany's industrial health sets the tone for the broader eurozone growth outlook. The DAX remains under pressure from tariff uncertainty, and the European Central Bank faces a delicate balancing act between supporting growth and monitoring any inflation pass-through from elevated energy prices.
More from Europe
Major UK Train Operator to Be Renationalised Within Months
The British government has confirmed that one of the country's main train operators will return to public hands within months. The move forms part of Sir Keir Starmer's phased plan to renationalise rail. Investors are reassessing the implications for rolling-stock suppliers and lease companies.
Russia and Ukraine Begin Three-Day US-Mediated Ceasefire
Russia and Ukraine have started a three-day US-mediated ceasefire announced by Donald Trump. Frontline clashes have visibly eased, even as the two sides trade accusations of violations. European capitals are pressing for the truce to be extended.
CBRT April Inflation Assessment: Annual inflation rises to 32.37 percent
The Turkish Central Bank released its April inflation assessment, showing consumer prices rose 4.18 percent month-on-month, while annual inflation climbed to 32.37 percent—up 1.50 percentage points. Energy prices surged 14.4 percent, with the underlying trend moving higher.