Germany's new government faces economic challenges after election victory

Friedrich Merz and his center-right Christian Democrats won Germany's recent election, likely making him the next chancellor. The new government faces challenges, including calls to ease borrowing rules and address energy costs amid ongoing economic pressures. The previous government, led by Olaf Scholz, collapsed over disputes regarding strict debt limits. Merz's coalition will need support from other parties to change these rules, which require a two-thirds majority in Parliament. Germany's public debt is currently over 60% of its GDP, lower than in many other countries. However, adjusting the debt brake to meet economic needs may prove difficult for the new administration.