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08.12.2025 12:54 AM
The IMF also believes that increasing government investments in 2026 will boost economic growth, while low public debt will allow for the attraction of additional funds. Germany's public debt stands at only 68% of GDP, the lowest figure among EU countries. As the saying goes, Germany has room to grow, provided there is the will to do so.
However, Germany epitomizes the well-fed and measured pace of the European Union. While in many other countries workers are willing to do overtime, actively seek new jobs in case of layoffs, and do not allow themselves to have idle time—where all adult family members work—many EU countries (including Germany) experience the opposite situation due to a high standard of living and good government support. People simply do not see the point in "working three jobs" when one salary is sufficient for everything. Interestingly, in Scandinavian countries, a four-day workweek is already in practice. It is believed that by resting more, employees show greater productivity during the work week. It is unlikely that anything similar can happen in China, the US, or Russia. This is the problem.
The IMF also warns that by 2027, economic growth could reach 1.5%, but further acceleration is highly questionable. Medium-term prospects remain uncertain. The demographic issue is another challenge for the German state. The country's population is decreasing, which negatively impacts the number of economically active individuals. In the next five years, the number of working-age people in Germany is forecasted to decline more sharply than in any other EU country, according to the IMF.
In fact, it has a direct connection. It should be understood that before Donald Trump took office, the exchange rate of the European currency had been declining for 17 years. In 2022, the decline stopped, but in the long term, it was merely a two-year correction. By 2025, this correction has every chance of turning into a trend, but only because Donald Trump returned to power in the US. If Trump had not been re-elected, demand for the US currency would likely have continued to rise, reflecting the European Union's internal problems.
Consequently, the primary focus is now on the American news backdrop, and this is precisely why the European currency is rising, albeit unwillingly. After all, the more expensive the euro becomes, the less EU exports. The European currency is compelled to appreciate, further worsening the already fragile economic situation in the Eurozone.
Based on the analysis of EUR/USD, I conclude that the instrument continues to build an upward section of the trend. The market has paused in recent months, but Donald Trump's policies and the Fed's remain significant factors in the US dollar's future decline. The targets for the current section of the trend could extend to the 25th figure. However, the latest upward section of the trend has again taken on a corrective appearance, so a downward wave may be starting within it, with a maximum leading to a new downward corrective set of waves.
The wave picture for GBP/USD has evolved. We continue to deal with an upward impulse section of the trend, but its internal wave structure has become complex. The downward corrective structure a-b-c-d-e in C in 4 appears quite complete. If this is indeed the case, I expect the main trend section to resume its build with initial targets around the 38 and 40 figures. However, wave 4 itself may take on a five-wave appearance.
In the short term, I anticipated the formation of wave 3 or c with targets around 1.3280 and 1.3360, corresponding to 76.4% and 61.8% Fibonacci levels. These targets have been reached. Wave 3 or C may continue its build, but the current wave set is likely corrective again. Therefore, a decline at the beginning of next week is also possible, and the attempt to break the 1.3360 mark has been unsuccessful.
