Germany's conservative leader clinches an major financial agreement ahead of a crunch vote in parliament.

German Chancellor-in-waiting Friedrich Merz said on Friday he had secured the crucial backing of the Greens for a massive increase in state borrowing, clearing the way for the outgoing parliament to approve the historic deal next week.

A new deal with the Greens could allow for as much as €1 trillion in new spending for defense and infrastructure over the next decade.

German Chancellor-in-waiting Friedrich Merz announced Friday his conservatives had struck a deal with the Greens on massively boosting defense

German Chancellor-in-waiting Friedrich Merz was set to make a last-ditch attempt on Friday to convince the Greens of his plans for a massive increase in state borrowing to bolster defence and infrastructure ahead of a parliamentary vote next week.

Mr Merz’s conservatives and the Social Democrats are in negotiations to form a government after February's election. Read more at straitstimes.com.

Germany’s next chancellor, Friedrich Merz, struck a deal to loosen borrowing limits, unleashing €500 billion for defence and infrastructure. Markets surged, while analysts debated its impact on inflation and ECB rate policy.