Growth through fiscal policy ‘limited’

Bundesbank president Jens Weidmann has said the room that governments have to stimulate growth through fiscal policy is often more limited than commonly believed.

Fiscal leeway “is usually much smaller than many think”, Weidmann told reporters in Cairns, Australia.

“It is limited by European rules, national rules, it is impacted by high debt levels, the demographic burdens we will face, but also by the credibility of a sustainable fiscal policy.”