Clock ticks for German fiscal bonanza but Merz ally optimistic


FILE PHOTO: Member of Christian Democratic Party (CDU) party Thorsten Frei is seen in Berlin, Germany, January 31, 2025. REUTERS/Liesa Johannssen/File Photo

BERLIN (Reuters) - A senior ally of Germany's likely next chancellor Friedrich Merz on Tuesday was optimistic about securing support for a massive increase in state borrowing this month, seeing the basis for a deal on defence with the Greens party after emergency talks.

The clock is ticking for Merz to persuade lawmakers in the outgoing parliament to back plans to unshackle Germany's tight borrowing limits as a way to lift Europe's largest economy out of its funk and pump hundreds of billions of euros into defence.

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