The Hamburg Institute of International Economics (HWWI) has updated its forecast for economic development in Germany. So far, the German economy has weathered the crises – currently the war in Ukraine and inflation in particular – better than feared. Although the German economy has slipped into a recession in the winter half-year following slight growth until the fall of 2022, this is only likely to be moderate and a moderate recovery can be expected from early summer – provided the geopolitical problems do not worsen. This would result in zero growth on an annual average for 2023, while the economy could grow noticeably again in 2024 at just under 2%. The rise in consumer prices is still high at almost 9%, but energy and other commodity prices, which have already fallen significantly, suggest that they will soon fall considerably. The inflation rate could fall below 4% by the end of this year and approach the 2% stability mark again by the end of 2024. It is important that excessive wage settlements do not trigger a cost-price spiral. Monetary policy could then also end its restrictive course.