BREAKING Wolfgang Schäuble to Step Down as German Finance Minister

Wolfgang Schäuble

Wolfgang Schäuble has announced he will step down as Germany’s finance minister, in what amounts to a momentous changing-of-the-guard in European financial policymaking, reports the Financial Times.

A budget hawk, he delivered a string of balanced budgets from 2014 onwards.

Schäuble was denounced by
Greece for his demands that Greece get its financial house in order, without financial assistance from Germany and the rest of the eurozone. Schäuble made it clear he was prepared to let Greece leave the eurozone. German Chancellor Angela Merkel ultimately ruled in favor of support for Greece.

News of his announced departure as finance minister came just three days after elections in which  Merkel’s conservative CDU/CSU bloc suffered their worst result since 1949 and the rightwing, anti-immigration Alternative for Germany won seats in the Bundestag for the first time.

Explains FT, Merkel faces the prospect of trying to form an unprecedented three-way coalition government with the liberal Free Democrats and Greens, two parties that have widely divergent views on the EU and eurozone reform.

Schäuble’s exit could make it more likely that the finance ministry will go to the FDP,  speculates FT 

The FDP has long been desirous of controlling the position. The party has taken a harder line on the eurozone than Merkel and called for a Greek exit from the single currency.

Schäuble will move on to become speaker of the Bundestag.

-RW