Germany’s economy grew by 0.4% in the first quarter of 2025, doubling initial estimates, driven by a surge in exports and industrial output in March as firms rushed to ship goods before new U.S. tariffs took effect.
This marks the fastest quarterly growth since Q3 2022.
However, analysts caution that this boost is likely temporary.
ING’s Carsten Brzeski called it “a positive one-off,” noting that the growth was largely due to frontloading ahead of U.S. trade measures.
The Bundesbank warns of stagnation in the current quarter, citing ongoing trade tensions and structural challenges.
Despite a €500 billion infrastructure fund introduced by Chancellor Friedrich Merz, the German Council of Economic Experts projects zero growth for 2025, highlighting the need for structural reforms.
