German banks tightened their credit standards for loans to enterprises in the fourth quarter of 2025 to an extent not seen since 2023. This is revealed by the Bundesbank's most recent round of the Bank Lending Survey. The banks pointed to the renewed rise in credit risk as the reason for this tightening.

Following significant GDP growth in the previous quarter, the German economy is likely to stagnate in the first quarter of 2026 in seasonally adjusted terms, according to the March issue of the Bundesbank’s Monthly Report. Industry’s weak competitive position, continued low capacity utilisation and a lag in the impact of government stimuli are dampening developments. The Middle East conflict is a source of additional burdens, especially as a result of rising energy prices, and these factors are keeping the inflation outlook particularly uncertain at present.

In April 2026, Germany’s current account recorded a surplus of €13.8 billion, down €10.7 billion on the previous month’s level. This was attributable to lower surpluses in the goods account and in invisible current transactions, which comprise services as well as primary and secondary income. 

Our new representatives provide a personal insight into their tasks at the Consulate General in Mumbai and at the OECD in Paris.

In spite of many burdens, the German economy grew more strongly than expected at the beginning of 2026 – partly because industry proved to be quite resilient. However, the labour market continued to deteriorate and the consequences of the war in Iran are clouding the outlook for the German economy in the second quarter.

The nominal effective exchange rates of the euro condense bilateral exchange rates against multiple countries into a single index. As an aggregate, they capture changes in euro exchange rates against various groups of currencies of key trading partners.