German bond yields have risen sharply in recent weeks, with Finance Minister Lars Klingbeil blaming higher borrowing costs on uncertainty linked to the conflict in Iran.
Klingbeil, who also serves as Germany’s vice chancellor, made the remarks Monday after a meeting of German-speaking finance ministers in Liechtenstein.
The Social Democratic Party politician told German news agency dpa that the conflict had affected both energy costs and financial markets.
He said consumers were feeling the impact through higher fuel prices. Investors had also become more cautious, contributing to higher government bond yields and borrowing costs, according to his remarks.
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Benchmark 10-year German government bond yields have increased in recent weeks. However, it did not provide a specific yield level for the latest move.
Higher yields raise the cost of new federal borrowing and add pressure to Germany’s budget. Klingbeil also renewed his call for a windfall tax on oil companies that benefit from higher energy prices during the conflict.
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He argued that companies earning larger profits from sharp price increases should contribute more through taxation.
