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Germany's economic outlook for 2026 shows cautious optimism—growth projected at 1%—but the picture gets murkier when you look under the hood. According to the German industry federation BDI, the manufacturing sector remains on shaky ground despite modest GDP improvement. This fragility in Europe's largest economy matters for anyone tracking macro trends affecting global risk assets. When Germany struggles, it typically signals broader European headwinds that can ripple through crypto markets during risk-off periods. The structural challenges facing German industry suggest that even a 1% uptick comes with serious caveats, making it worth monitoring as geopolitical and economic tensions continue reshaping investment flows.