Germany – EU elections and Thuringia state elections: another blow for Schroder but clearest message is that reform momentum is now stalled
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SummarySlump in Schröder’s SPD support and positive showing of former Communists in elections spark renewed debate on reforms within the party; Prospects of significant further reform before federal elections (2006) now slim; Any growth dividend will likely be spent on loosening fiscal policy; CDU/CSU centre-right coalition with Liberals becoming more likely (possibly pre-2006) but this is not clearcut, given mixed results for CDU; Greens fare well on Europe, but coalition with the CDU is no option for them
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© Graham Bishop
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