Berlin’s decision to lift all caps on military spending and binge on infrastructure marks a U-turn for the fiscally conservative country.

Northern European countries traditionally unenthusiastic about higher spending are wary of Germany’s new-found desire to splash the cash.

Germany is in for a massive ramp-up in spending under an agreement by the parties hoping to form its next government, with a 500 billion euro special fund sought for infrastructure and plans to unshackle defence investment from its debt rules.