Germany is approaching recession as inflation will exceed the 10 percent mark, according to a monthly report from the Bundesbank, Politico reports. 

There are growing signs of a recession in the German economy in the form of a pronounced, widespread and prolonged decline in output, the report said.

The central bank forecasts a moderate contraction in the current quarter and a more pronounced decline in activity in the last quarter of this year and the first quarter of next year.

High inflation and uncertainty about energy supply and costs are affecting not only the gas- and electricity-intensive industry, its export business and investments, but also private consumption and the service providers that depend on it, the central bank said in the report.

The Bundesbank did not give specific figures and warned that the outlook for the eurozone's largest economy remains uncertain. Germany's industrialized economy is highly dependent on Russian gas, making it particularly vulnerable to the effects of the war in Ukraine.

Inflation is expected to continue to accelerate and reach double digits in the coming months, the report said.