Steinbrueck predicted that the current banking crisis would probably continue in 2008, although he declined to predict whether a credit crunch would hit Germany as well.

‘I simply don’t know. What I see is significantly increased mistrust in interbank trade,’ he said in an interview in Germany’s Boersen Zeitung.

‘My colleagues in the USA view the situation as more critical than they did three or four months ago,’ Steinbrueck said.

The paper reported that he declined to give any forecast about when the situation would improve, saying:’It makes no sense to make very nervous markets even more nervous.’

The paper also said Steinbrueck believed the turbulence on financial markets might boost the chances of setting up a European ratings agency.