11.06.2026 • 17/2026
Economic Outlook: Between Energy Crisis and AI Boom
Until the outbreak of the energy crisis, the German economy was on a path to recovery. Now the recovery will only continue over the course of 2026 if the Gulf conflict eases and energy prices do not rise further. This assumption underlies the present summer forecast of the Halle Institute for Economic Research (IWH). In that case, German output is expected to increase by 0.9% for this year and for 2027. Growth rates in East Germany will be similar. In March, the IWH economists had predicted growth of 0.7% for 2026 and 1% for the next year.
Oliver Holtemöller
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Konjunktur aktuell: Zwischen Energiekrise und KI-Boom
Konjunktur aktuell,
No. 2,
2026
Abstract
Die deutsche Wirtschaft steht infolge der Energiekrise und des anhaltenden Golfkonflikts vor einer unsicheren Erholung. Steigende Kosten und eine schwächere Beschäftigungsentwicklung belasten die Konjunktur, während die Finanzpolitik stützend wirkt. Unter der Annahme stabiler Energiepreise dürfte die Produktion in diesem und im kommenden Jahr um jeweils 0,9% zunehmen; ähnliche Expansionsraten sind auch für Ostdeutschland zu erwarten.
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Halle Institute for Economic Research
Between Energy Crisis and AI Boom The summer forecast of the Halle Institute for Economic Research (IWH) assumes that the Gulf conflict eases and energy prices do not rise…
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Economic Outlook
IWH Summer Forecast 2026 Between Energy Crisis and AI Boom June 11, 2026 Until the outbreak of the energy crisis, the German economy was on a path to recovery. Now the recovery…
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Reports Flagship Firm Productivity Report 2023 Introducing the release of the 2023 Flagship Firm Productivity Report , providing critical insights into the short-term impact of…
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The German Energy Crisis: A TENK-based Fiscal Policy Analysis
Alexandra Gutsch, Christoph Schult
IWH Discussion Papers,
No. 1,
2025
Abstract
We study the aggregate, distributional, and welfare effects of fiscal policy responses to Germany’s energy crisis arising in 2022 using a novel ten-agent New Keynesian (TENK) model. The crisis, compounded by the COVID-19 pandemic, led to sharp price increases and significant consumption disparities. Our model, calibrated to Germany’s income and consumption distribution, evaluates key policy interventions. We find that non-targeted transfers had the largest short-term aggregate impact, while targeted transfers for lower income households were more cost-effective. The energy cost brake and reductions in gas and oil taxes have shown very little effect, but were comparatively cost-effective under the assumption of exogenous prices. Our results highlight how targeted fiscal measures can address distributional effects and stabilize consumption during crises.
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