German economy likely to shrink 6.6% this year, Ifo says

The German economy is likely to shrink by 6.6% this year as a consequence of the coronavirus pandemic before growing by 10.2% in 2021, the Ifo Institute said on Thursday in its latest update.

On average, businesses expected operations to return to normal in nine months after lockdowns in the second quarter, Ifo said. In that case, the economy would shrink 12.4% in the second quarter of this year.

In Ifo’s worst case, in which a return to normal took 16 months, the economy would shrink 9.3% this year and grow 9.5% in 2021. In the best case, companies would recover in five months, the economy would shrink just 3.9% and expand 7.4% next year.