On Wednesday, 10-year German bonds saw the worst day since March 1990 — just months after the fall of the Berlin Wall.

Germany's government bonds staged a historic selloff on Wednesday, as investors braced for the government to break with years of balanced-budgeting in an effort to revive the economy and bolster military defenses.

World financial markets kept on a radical readjustment course on Thursday after U.S. President Donald Trump's shakeup of the transatlantic relationship spurred a seismic, half-a-trillion-euro shift in German defence and infrastructure spending.

BERLIN (AP) — The prospective partners in Germany’s next government said Tuesday that they will seek to loosen the nation’s rules on running up debt to allow for higher defense spending. They said they also will seek to set up a huge 500 billion euro ($533 billion) fund to finance spending on Germany’s infrastructure over the next 10 years.

The parties hoping to form Germany's next government on Tuesday agreed to create a 500 billion euro infrastructure fund and overhaul borrowing rules in a tectonic spending shift to revamp the military and revive growth in Europe's largest economy.

Exempting defence spending from the debt brake will enable a sustainable build-up of military capabilities, and infrastructure investment via