After months of negotiations, Germany's coalition government has reached an agreement on the 2025 federal budget.

Chancellor Olaf Scholz, along with Finance Minister Christian Lindner and Economy Minister Robert Habeck, announced the breakthrough early Friday morning.

The deal maintains the debt brake, increases child benefits, and includes a growth package to stimulate the economy.

Key points include a €5 increase in child benefits, an additional €1.2 billion for the defense budget, and €2 billion for improving childcare quality.

The coalition aims to boost economic growth by over half a percent through accelerated investment write-offs and improved research allowances.

Despite criticism from opposition parties, the government emphasizes its commitment to fiscal responsibility while addressing key social and economic priorities.