Germany to Suspend Borrowing Limit Again After Budget Shock
- Finance Minister Lindner forced into climbdown on debt brake
- Restriction to be lifted for fourth consecutive year in 2023
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Germany will suspend a constitutional limit on net new borrowing for a fourth consecutive year after Chancellor Olaf Scholz’s government was forced into a radical budget overhaul by a ruling last week from the nation’s top court.
The emergency move to lift the so-called “debt brake” will be part of a revised 2023 budget that Finance Minister Christian Lindner plans to present next week, a spokeswoman for his ministry said Thursday. Because of the court judgment, Lindner has to retroactively account for at least €37 billion ($40.3 billion) of new off-budget debt earmarked to ease the burden of high electricity and gas prices on households and companies.