Germany’s incoming finance minister rings alarm bell on inflation -Breaking
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BERLIN, (Reuters) – Germany’s new Finance Minister Christian Lindner pledged on Tuesday that he would champion strong public finances as well as a reduction of the debt level in the euro area so that the European Central Bank can fight inflation without hesitation if necessary.
Lindner posted his comments on Twitter (NYSE : ) after data revealed that German consumer inflation increased further in November, reaching its highest point in almost three decades.
The inflation raises legitimate concerns. Lindner’s tweets stated that in the event of currency devaluation we would observe its development after the pandemic.
Lindner’s business-friendly Free Democrats will be the smallest junior member in a three way coalition with the center-left Social Democrats, and the pro-spending Greens. He stated that the new government wouldn’t push prices further.
Lindner stated that there will be no tax hikes and added that all three parties have agreed to lower electricity prices through the elimination of a surcharge to fund the growth in renewable energy.
Lindner stated that government revenue from the rising carbon price would go to the household.
We will advocate strong public finances in Europe and Germany and the limitation of debt. Lindner said that an excessively large government deficit would prevent the ECB’s ability to combat inflation if it was necessary.
Jens Weidmann (outgoing Bundesbank President, ECB Policymaker) echoed his comments. Jens Weidmann said that the ECB must remain separate from governments and resist pressure to bail out indebted nations or achieve other objectives than price stability.
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