Read my lips, it's the war

"It can already be seen that the war in Iraq has increased the economic uncertainties worldwide, and some of the hopes for economic growth have been impaired, if not entirely destroyed," Mr Schroeder said in a speech on Sunday night.

The Commission is expected to cut euro zone growth to 1% from the previous 1.8%, blaming the war on Iraq.

The target for Germany, the largest economy in the euro zone, is expected to slashed 0.4% from 1.4% for 2003 and to 2% from 2.3% for 2004.

The Commission's spring forecast has been widely leaked ahead of its official release.

The German patient

The German government has staunchly opposed the war on Iraq.

Mr Schroeder has previously blamed weakening German growth on US economic problems and the 11 September attacks.

German business lobby groups rejected Mr Schroeder's analysis.

"The main reason for the continued poor situation is not the Iraq conflict but the long-existing competitive weakness of the German economy," Ludwig Georg Braun, head of the DIHK chambers of commerce, told the Berliner Zeitung newspaper.

The government's official forecast for growth in 2003 is still 1%, which it has said is the minimum rate needed to bring reign in its deficit to below EU limits.

Commission's crystal ball

The EU forecast for French growth is expected to be lowered to 1.1% from 2% for 2003 and 2.1% from 2.7% for next year.

The Commission will also say that Italy will become the fourth country to breach the 3% of GDP deficit limit of the EU's stability and growth pact, which underpins the euro.

The 2003 inflation forecast is due to be left unchanged at 2% but cut to 1.7% from 1.8% for next year.

The last forecasts were published on 13 November.