21 March | Euro

Increase in Germany’s spending raises economic risks across Europe

Increase in Germany’s spending raises economic risks across Europe

Bloomberg reports that Germany's increased government spending is driving up borrowing costs across Europe. The situation is especially perilous for the countries with high national debt, such as Italy and Spain, where bond rates have already climbed more than 30 basis points. 

According to the news agency, investors are concerned that highly indebted nations may struggle to pay interest on the debt. This may result in another European debt crisis similar to the one that occurred more than a decade ago. 

Despite the risks, some experts are optimistic. For example, Lynda Schweitzer of Loomis, Sayles & Company, who holds Spanish, Italian and French bonds, considers a softer fiscal policy to be a potential driver for economic growth. She believes funding infrastructure and other key sectors will help boost GDP growth and thus partially offset the increasing debt load. 

Period: 01.05.2025 Expectation: 1000 pips
GBPUSD to test level of 1.34 again
25 April 2025 58
Brent sell
Period: 01.05.2025 Expectation: 660 pips
Trade uncertainty and excess OPEC+ supply are dragging down Brent
25 April 2025 48
Period: 29.04.2025 Expectation: 600 pips
USDCAD to head towards 1.39400 after rebounding from 1.38200
25 April 2025 38
Period: 02.05.2025 Expectation: 1669 pips
AUDCAD gains on potential easing of trade tensions between US and China
25 April 2025 37
Period: 30.04.2025 Expectation: 12000 pips
ETHUSD set to test upper boundary of downtrend channel
24 April 2025 94
Period: 25.04.2025 Expectation: 500 pips
AUDUSD to fall to 0.63000
24 April 2025 46
Go to forecasts