Finance
Merz rules out loosening Germany's debt limits again in current term
Published by Global Banking & Finance Review®
Posted on February 21, 2026
2 min readLast updated: February 21, 2026
Quick Summary
At the CDU congress in Stuttgart, Chancellor Friedrich Merz said Germany will not further loosen its debt brake before 2029. Delegates backed the stance amid criticism that earlier changes expanded routine spending.
Merz Rejects Further Easing of Germany’s Debt Brake This Term
Germany’s Debt Brake Debate and Merz’s Stance
STUTTGART, Germany, Feb 21 (Reuters) - Chancellor Friedrich Merz on Saturday ruled out a further loosening of German borrowing limits before the next federal election in 2029, arguing it would be irresponsible to take on more debt.
Background: Early Loosening After Election Win
Merz moved quickly to loosen Germany's constitutionally-enshrined borrowing limits known as the "debt brake" after winning an election in February last year, freeing up hundreds of billions of euros for defence and infrastructure spending.
Backlash and Criticism Over New Debt
But the move created a backlash including from among his own voters. Critics argued the new debt gave the government more leeway for day-to-day spending rather than improving Europe's largest economy by addressing years of underinvestment.
CDU Motion Passed at Stuttgart Meeting
Broadcast Interview with ARD
Merz’s Remarks at CDU Conference
"In my view, taking on more debt is irresponsible," Merz told the ARD broadcaster during his Christian Democratic Union's (CDU) party conference in Stuttgart, where the party also passed a motion against more debt brake reform.
Pledge Through Next Federal Election in 2029
"The fundamental message of this party conference is clear, and this is my own: We are taking on enough debt during this legislative period."
(Writing by Matthias WilliamsEditing by Peter Graff)
Key Takeaways
- •Merz ruled out additional loosening of Germany's debt brake during the current legislative term.
- •His earlier move after the 2025 election freed funds for defense and infrastructure.
- •Critics say prior changes enabled day-to-day spending instead of tackling underinvestment.
- •CDU delegates in Stuttgart passed a motion opposing further debt brake reform.
- •Merz reiterated on ARD that taking on more debt now would be irresponsible.
Frequently Asked Questions about Merz rules out loosening Germany's debt limits again in current term
1What is the main topic?
Germany’s government, led by Chancellor Friedrich Merz, will not further loosen the constitutionally enshrined debt brake this term, a stance affirmed at the CDU party conference in Stuttgart.
2Why is the debt brake controversial?
Supporters say it preserves fiscal discipline; critics argue earlier changes enabled routine spending and failed to fix chronic underinvestment in Europe’s largest economy.
3When could the rules change next?
Merz ruled out additional changes before the next federal election in 2029, so any further reform would likely be debated after that vote.
