IMF raises Germany growth forecast to 1.3% in 2026
The IMF upgraded Germany’s 2026 outlook and lifted eurozone and global forecasts, citing state investment, exports and AI demand.
On 13 October 2026 the International Monetary Fund raised its outlook for Germany, forecasting that the German economy will expand by 1.3 percent in 2026 — nearly double the Fund’s July estimate of 0.7 percent.
The IMF also lifted its projection for the eurozone: growth for the monetary union is now seen at 1.1 percent in 2026, up 0.2 percentage points from the July forecast, while growth of 1.2 percent is expected in 2027.
Why Germany’s outlook improved
German Economy Minister Katarina Reiche (CDU) said the improved outlook is driven largely by public spending and stronger external demand. "Two thirds of the improved outlook are due to public investment in infrastructure and defence, and one third to exports," she said.
The IMF highlighted several factors behind Germany’s surprising resilience: government investment in infrastructure and defence, a boost in shipments of energy‑intensive goods such as steel, fertilisers and aluminium amid tighter global supply, and spillovers from a surge in demand linked to artificial intelligence for German suppliers.
Globally, the IMF now expects world GDP to grow by 3.1 percent in 2026, up from a previous forecast of 3.0 percent, with 3.4 percent pencilled in for 2027. The Fund said energy shocks from the conflict in the Gulf have been cushioned by higher oil production outside the region, releases from strategic reserves and weaker demand in China.
The IMF left its outlook for the United States unchanged at 2.3 percent growth for 2026, and projected a similar pace for 2027. The Fund warned, however, that if expectations from the AI boom prove excessive, a sharp sell‑off in tech stocks could slow global growth.
Photo: press material from the event
