The war in the Middle East is weighing on the German economy and will initially slow down the recovery that began in the winter half-year. Nevertheless, Bundesbank President Joachim Nagel is confident: Economic activity will gain traction again over our forecast horizon up to 2028, he said upon publication of the Bundesbank’s new Forecast for Germany. The recovery will be supported by falling energy prices, a strengthening global economy and, above all, strong stimulus from fiscal policy. [...]