German economic advisers raise growth outlook while calling for fiscal reform

Germany's council of economic experts, known as the "Wirtschaftsweise," has raised its domestic growth forecast, projecting gross domestic product to expand by 1.3 percent this year—the strongest rate since 2022—followed by 1.0 percent in 2027. Despite the improved outlook, advisers warned of persistent inflation risks and urged structural spending cuts alongside potential revenue measures, such as a defense surcharge, to stabilize public finances. Deutsche Welle and Tagesschau emphasized that long-term prosperity remains uncertain without broader structural reforms and productivity gains.

In parallel corporate developments, defense sensor provider Hensoldt reported robust revenue growth expectations accompanied by 100,000 job applications. Furthermore, the German federal government has finalized a €6.6 billion acquisition of a 50 percent stake in defense manufacturer KNDS.

Sources: DW, Der Spiegel, Der Standard, FAZ, Tagesschau