German elections - Merkel move crucial for Irish finance

SELDOM was a general election in another European state watched more closely by the Irish people than Angela Merkel’s performance yesterday, which put her in an unassailable position to become Chancellor of Germany for a historic third term in succession.

Ultimately, her party’s victory is assured, according to an estimated 42% exit poll. It will have repercussions throughout Europe, but nowhere more so than in the bailed-out economies of Ireland, Portugal, and Greece, where people are being ground down by austerity measures.

From Ireland’s viewpoint, the result effectively sets the agenda for the post-bail-out era and will have a major influence on this country’s economic and financialdirection in the coming years. Of crucial importance will be the shape of the coalition that emerges when Ms Merkel gets down to the business of political horse-trading today.