Germany budget deficit exceeds EU Maastricht limit

Germany's general public budget deficit rose to 71.3 billion euros during the January-June 2026 period, an increase of 36.6 billion euros compared to the same period last year. According to data from the Federal Statistical Office (Destatis), the deficit reached 3.1% of gross domestic product (GDP), exceeding the 3% limit established by the Maastricht Treaty under the EU Stability and Growth Pact.

Public spending grew by 6.1% to 1.1445 trillion euros, outpacing the 2.8% growth in total public revenue, which reached 1.0732 trillion euros. The largest deficit occurred at the federal level, which recorded a 48.1 billion euro deficit, driven largely by increased defense spending, additional investments, and subsidies financed through special funds.

At the regional level, state budget deficits increased by 3.5 billion euros to 6.5 billion euros, while municipal deficits decreased by 1.5 billion euros to 14.8 billion euros. Social security funds, which previously held a surplus, recorded a 1.8 billion euro deficit due to rising costs in statutory health and long-term care insurance. Additionally, rising global interest rates have impacted Germany's debt costs, with 10-year government bond yields reaching a 15-year high of 3.3%.