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

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German Finance Minister Christian Lindner attends the weekly cabinet conference 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 said there was a chance of a time period of large inflation and low growth next Russia’s invasion of Ukraine, which experienced pushed already substantial inflation up more still.

“Stagflation is a doable state of affairs,” he told a conference of spouse and children-owned organizations in Berlin on Monday.

He reported the price tag tension could most effective be countered by unwinding the subsidies that had formerly been presented out to prop up the economic climate and that Germany and Europe experienced to return to fiscal discipline.

He included that Germany’s constitutional financial debt brake, at present suspended, would come back again into pressure upcoming yr. That would suggest a reduction in the degree 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 creating by Thomas Escritt Modifying by Christoph Steitz

Our Standards: The Thomson Reuters Trust Rules.

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