Germany's government-in-waiting unveiled a plan to boost defense spending by hundreds of billions of dollars by the end of the decade by relaxing strict so-called "debt brake" rules enshrined in its constitution.

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

Germany has preached fiscal conservatism for years, but suddenly it’s taking the lead on pushing for European Union reforms aimed at freeing up more money for defense spending over the long term. A German envoy to the bloc has urged the bloc to change its budget rules in the face of geopolitical circumstances,

Hours after the U.S. suspended military aid for Ukraine, the European Union proposed the fund to bolster military spending and support Kyiv.

Leaders of the European Union's 27 countries will be joined by Ukrainian President Volodymyr Zelenskiy at a summit in Brussels, although their show of solidarity may be marred by Hungary refusing to endorse a statement backing Kyiv.