Bundesbank expects slowdown in German GDP growth due to the low Rhine


08/21/2026

Experts from Bundesbank anticipate that significantly reduced water levels in German rivers, especially the Rhine, caused by the recent heat wave, are likely to restrict the nation's GDP growth in the third quarter of 2026.



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The bank noted in its August report that a restricted number of shipping routes on key rivers, coupled with a dramatic rise in shipping expenses, is anticipated to greatly restrain industrial output and hinder export expansion.

A significant decrease in the Rhine during another heat wave in Europe has caused issues with cargo ship navigation. As stated by the Federal Waterway and Shipping Authority (WSV), the shipping depth (underwater clearance) at the narrow point close to Koblenz was 12 centimeters, down from the earlier minimum of 25 centimeters noted in 2018. In these circumstances, vessels must decrease their cargo to traverse the challenging area.

In the majority of Western Europe, this year's June and July were the warmest ever recorded.

Reduced river levels will cause supply delays, worsening material shortages, raising transportation costs, and hindering production, the Bundesbank predicts: "This will create considerable stress on industrial production, which has only recently started to recover."

Despite the German economy showing greater resilience than anticipated in response to rising energy prices from the Middle East conflict in early 2026, analysts think that economic growth in the third quarter will, at most, see a minor uptick.

source: dw.de