In spite of many burdens, the German economy grew more strongly than expected at the beginning of 2026 – partly because industry proved to be quite resilient. However, the labour market continued to deteriorate and the consequences of the war in Iran are clouding the outlook for the German economy in the second quarter.

German banks tightened their credit standards for loans to enterprises in the fourth quarter of 2025 to an extent not seen since 2023. This is revealed by the Bundesbank's most recent round of the Bank Lending Survey. The banks pointed to the renewed rise in credit risk as the reason for this tightening.

Our new representatives provide a personal insight into their tasks at the Consulate General in Mumbai and at the OECD in Paris.

The nominal effective exchange rates of the euro condense bilateral exchange rates against multiple countries into a single index. As an aggregate, they capture changes in euro exchange rates against various groups of currencies of key trading partners.

The war in Iran and the blockade of the Strait of Hormuz have shaken global energy markets and evoked memories of 2022, when Russia’s attack on Ukraine significantly exacerbated the energy crisis of 2021/22. In the current issue of the Monthly Report, Bundesbank experts examine both crises and show that while there are parallels there are also significant differences.

The same methodology as the real effective exchange rates of the euro is used to calculate price competitiveness indicators for individual euro area countries.