March 10, 2025 at 01:14PM
This speech is a bit out of the central bank’s lane. With Mark Carney about to be named Prime Minister, expect a few more central bankers to start sounding like politicians.
In this speech German Bundesbank President Joachim Nagel outlined a 12-point plan to boost German growth.
The ECB rate cut of 25bps in March was appropriate given progress on price stability
Germany’s potential growth has fallen to just 0.4% annually – a full percentage point lower than in the previous decade
Here are the 12 points:
Increase part-time workers’ hours by reforming tax incentives and improving childcare
Promote labor-focused immigration with faster visa processes and better integration
Improve work incentives for welfare recipients by reconsidering recent reforms
Strengthen work incentives for older workers by linking retirement age to life expectancy after 2031
Apply uniform carbon pricing across all sectors to ensure most cost-effective emissions reduction
Create reliable framework for energy transition with clear plans for renewable expansion
Eliminate climate-damaging subsidies that counteract carbon pricing
Further integrate European energy markets to better balance supply and demand
Reduce bureaucracy by systematically reviewing regulations and streamlining reporting requirements
Facilitate business formation through one-stop shops and completing the EU single market
Reduce corporate tax burden potentially through accelerated depreciation or corporate tax rate cuts
Simplify and accelerate administrative processes by setting time limits on decisions
Here is the speech.
This article was written by Adam Button at www.forexlive.com.
