Germany's Ifo Economic Institute said on Wednesday that the German economy is expected to contract by 0.1% in 2023.

"In the two quarters of the winter half-year 2022/23, the gross domestic product shrinks, but then it goes up again," said Timo Wollmershaeuser, Ifo's head of forecasts, in a statement.

Ifo also said inflation in Germany is forecast to decline to 6.4% in 2023 and to 2.8% in 2024 from 7.8% in 2022.

Market reaction

Germany's DAX 30 Index edged lower following this publication and was last seen losing 0.62% on a daily basis.