German recovery further delayed and inflation may pick up, Bundesbank warns

Germany's economic recovery may be delayed, and inflation could rise "temporarily" by year's end, according to the Bundesbank's latest report. The country's economy unexpectedly contracted last quarter, with indicators signaling only slow growth.

However, the Bundesbank does not foresee a significant recession unless new negative factors emerge. It predicts private consumption and services may improve due to increased household disposable income, despite weak foreign demand impacting the industrial sector.

Though inflation has decreased, it might rise again at the end of 2024 due to previous low energy prices. The bank stated, "We can expect somewhat higher inflation rates temporarily towards the end of the year."