Citing a senior government official with direct knowledge of the matter, Reuters reported that Germany was mulling a “U-turn” in fiscal policy as it was considering the issuance of new debt to finance the climate protection package.
“German Finance Ministry could link possible new debt strictly to climate measures to avoid opening budget flood gates,” the source said. A spokesman for the German Finance Ministry declined to comment on the issue.
These comments seem to be helping the shared currency find demand as more government spending could mitigate the need for new stimulus. As of writing, the EUR/USD pair was up 0.22% on the day at 1.1222.
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