Germany's outgoing parliament set to approve defense fund while delaying debt brake reform

Germany's outgoing parliament may approve a special fund to increase defense spending, but changes to borrowing limits will wait for the new parliament. This follows Friedrich Merz's election win amid a challenging political landscape. Merz's coalition talks may be complicated by the rise of far-right and far-left parties. The need for quick decisions on security and foreign policy has been emphasized, especially given tensions with the U.S., Russia, and China. Reforms to the 'debt brake' limiting state borrowing will not be expedited. Merz has called for Europe to enhance its defense capabilities in light of current global challenges.