German finance minister warns of stagflation risk, pledges return to fiscal rigour

German Finance Minister Christian Lindner attends the weekly cupboard meeting at the Federal Chancellery in Berlin, Germany, June 8, 2022. REUTERS/Hannibal Hanschke

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BERLIN, June 13 (Reuters) – German Finance Minister Christian Lindner explained there was a possibility of a time period of higher inflation and very low development next Russia’s invasion of Ukraine, which experienced driven now large inflation up additional nevertheless.

“Stagflation is a doable circumstance,” he explained to a meeting of family-owned companies in Berlin on Monday.

He reported the price tension could very best be countered by unwinding the subsidies that had previously been offered out to prop up the economic system and that Germany and Europe experienced to return to fiscal self-control.

He added that Germany’s constitutional credit card debt brake, presently suspended, would appear back again into pressure upcoming yr. That would suggest a reduction in the stage of new borrowing from this year’s 140 billion euros ($146 billion) to just 10 billion euros.

($1 = .9591 euros)

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Reporting by Christian Kraemer producing by Thomas Escritt Editing by Christoph Steitz

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