The German economy had stabilised towards the end of last year; many economic indicators developed positively. The growth opportunities for 2026 and 2027 were assessed favourably due to the fiscal spending programmes and support measures launched by the coalition government. However, with the Iran war and the resulting price shocks for oil and gas, the prospects for inflation and growth – not only in Germany, but worldwide – have initially deteriorated. The further development of the Iran conflict is unclear – here it is assumed that the war will be limited to the territory of Iran by the middle of the year at the latest and that the Strait of Hormuz will be freely passable again. Oil and gas prices would then move back towards pre-war levels. The recovery of the German economy, scheduled for 2026/2027, could then “pick up speed” again in the second half of this year. Under these conditions, the HWWI expects average annual economic growth of 3/4% for 2026 (before the outbreak of war: 1 1/2%) and one of 1 1/2% for 2027.