(Bloomberg) -- German Deputy Finance Minister Florian Toncar warned that the country faces a growing threat of rising consumer prices and low growth rates.

“We are experiencing supply-chain problems, production bottlenecks and price increases the likes of which we haven’t seen in decades,” Toncar told VersicherungswirtschaftHEUTE in an interview.

“Growth forecasts have been revised noticeably downward in recent months, while inflation forecasts have been revised ever upward,” he said. “In this environment, there is an increasing risk of stagflation.”

Germany’s economy is suffering inflation that may touch double digits by the end of the year, according to the Bundesbank. At the same time, analysts are increasingly concerned that the economy may fall into recession.

“We are complying with the debt brake by spending less,” Toncar said. “For example, war- and crisis-related spending will be reduced next year.”

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