Reuters reports that the Ifo economic institute cut its growth forecast for Germany for this year as supply chain disruptions and scarcity of intermediate goods are slowing down the recovery from the COVID-19 pandemic.

The Ifo institute now sees Germany's GDP to grow 2.5% this year, down 0.8% percentage points from its previous forecast, and 5.1% next year, up 0.8% points.

"The strong recovery from the coronavirus crisis, originally expected for the summer, is further postponed," Ifo chief economist Timo Wollmershaeuser said.

"Industrial production is currently shrinking as a result of supply bottlenecks for important intermediate goods. At the same time, service providers are recovering strongly from the coronavirus crisis," Wollmershaeuser added.

In a separate forecast, Germany's association of private sector banks (BdB) gave a more optimistic outlook for growth in 2021. It expects GDP growth of 3.3% this year and 4.6% next year.