Germany will release GDP growth figures on Friday, after the euro surged this week amid dollar weakness.
EURUSD – Daily Chart
The EURUSD surged over the last week as investors abandoned the U.S. dollar. The upcoming data will determine whether the previous resistance holds.
The latest growth figures for Germany are released at 4 pm, and analysts expect a 0.2% improvement from a flat Q3. The year-on-year figure is expected to show a similar number of 0.3% growth.
“Germany’s economy is so bad even sausage factories are closing,” a headline from The Economist said. Businesses are struggling as higher costs and flat spending put pressure on producers.
The German government lowered its 2026 growth forecast on Friday to 1%, admitting that efforts to kickstart Europe’s largest economy with vast public spending were moving more slowly than hoped.
The estimate was down from a previous forecast of 1.3% GDP growth made in October, and comes as Chancellor Friedrich Merz faces growing criticism over his weak efforts to revive the export-driven economy.
While the performance is expected to improve on recent years, when output was weak in 2025 after two years of recession, it is still a disappointing outlook for officials in Berlin who had hoped for a stronger bounce.
“The expected stimulus from economic and fiscal policy measures did not materialise quite as quickly or to the extent that we had assumed,” Economy Minister Katherina Reiche said.
The German economy has been hit by a manufacturing slump, high energy prices, weaker demand in major export markets like China, and strong international competition, alongside Trump’s tariff moves.
Merz had eased Germany’s strict debt rules to push through stimulus, but that has not yet had the effect on the economy that some had hoped.
