The German government on Wednesday slashed its 2025 growth forecast for the country's economy, Europe's biggest, to just 0.3% after it shrank for two consecutive years. The new projection is much lower than the government's previous forecast of 1.

The German government has slashed its growth projection for 2025 to 0.3%, down from 1.1% previously, newspaper Handelsblatt cited government sources as saying on Friday, as the economy shows little sign of recovering from two years of contraction.

Berlin brought down its 2025 economic growth forecast from 1.1% to 0.3%. A government report cited the collapse of the government as the main reason.