Germany’s far-right boosted by stance against Iran war

The FT News Briefing explores how geopolitical tensions are reshaping domestic politics and financial policy across Europe and the U.S. In Germany, the far-right Alternative for Germany (AFD) has surged in popularity amid growing public backlash against the U.S.-led conflict in Iran, which has driven up fuel prices and reignited deep-seated anti-American sentiment—particularly in former East Germany. While Chancellor Friedrich Merz has also criticized the war, only the AFD has effectively capitalized on the discontent, positioning itself as a nationalist alternative. The party, long considered extremist and taboo, now stands a real chance of winning a regional election in Saxony and Halt, potentially making it the first far-right party to hold executive power in a German federal state. Meanwhile, the Bank of England is reconsidering its strict regulations on stablecoins, easing proposed limits on holdings and backing requirements after concerns that the UK risks falling behind the U.S. in the digital asset race. The shift reflects broader anxieties about competitiveness in fintech, though it comes with risks to financial stability and credit flows. The episode also touches on U.S. political developments, including Kevin Warsh’s confirmation as Federal Reserve chair and growing speculation about a potential leadership challenge to UK Prime Minister Keir Starmer.