Published by Global Banking & Finance Review®
Posted on March 17, 2025
1 min readLast updated: January 24, 2026
Add as preferred source on GoogleGermany's fiscal policy plans for 2025 aim to stabilize economic expectations and provide planning security, despite ongoing uncertainties.
BERLIN (Reuters) - Germany's economic weakness carried over into the start of 2025, but fiscal policy plans by the country's future government could help stabilise expectations and provide planning security, said the economy ministry in its monthly report on Monday.
"Even if foreign and geopolitical uncertainties are unlikely to diminish in the foreseeable future, the fiscal policy plans currently being discussed by the future governing coalition could have a stabilising effect on expectations and increase planning certainty for private households and the economy," said the ministry in its report.
German chancellor-in-waiting Friedrich Merz said last week that he had secured the crucial backing of the Greens for a massive increase in state borrowing, clearing the way for the outgoing parliament to approve the historic deal this week.
Merz's conservatives and the Social Democrats, who are in negotiations to form a government after an election last month, had proposed a 500-billion-euro ($544 billion) fund for infrastructure and sweeping changes to borrowing rules to bolster defence and revive growth in Europe's largest economy.
(Reporting by Miranda Murray, editing by Thomas Seythal)
The article discusses Germany's fiscal policy plans and their potential impact on economic expectations.
A 500-billion-euro fund for infrastructure and changes to borrowing rules are proposed.
Friedrich Merz is the German chancellor-in-waiting who secured backing for increased state borrowing.
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