Bundesbank: German Inflation to Stay Elevated for Some Time

The Bundesbank is describing a stagflationary mix rather than a simple slowdown: sticky inflation limits how quickly relief can arrive even as output stalls. This matters most for rate-sensitive sectors and for the ECB's room to maneuver, since persistent German price pressure constrains the easing path regardless of weak growth. The bank's own fourth-quarter recovery call is the key assumption to test — whether that rebound actually materializes against continued inflation is the open question.