Merz’s Big Year of Economic Renewal in Germany Is Going Awry

Chancellor Friedrich Merz’s bid for a meaningful rebound in 2026 is getting harder to deliver by the week, despite the huge stimulus flowing into Europe’s biggest economy.

With the war in the Middle East stoking energy costs, igniting inflation and hurting confidence, Germany’s long-awaited nascent recovery is already souring. That’s what growth data next week may begin to hint at, just days after the government halved its outlook for the year.