Berlin - German Finance Minister Peer Steinbrueck warned Saturday of the threat of global inflation as a result of the economic and financial crisis. "There is so much money being pumped into the market that there could be a threat of an overloading of the capital markets and worldwide inflation when an economic recovery comes," Steinbrueck told the newspaper Bild.

In the short-term there was no danger, but in the medium-term "we'll have to see how we can remove the billions in liquidity from the market that we are now pumping into the economy," he said.

He said this would present a major challenge to central banks, including the European Central Bank , which will have to ensure monetary stability.

Steinbrueck said there was no alternative to the "sensible" stimulus packages that some governments are using to combat the economic downturn.

At the same time, he voiced concern "the next crisis is being pre-programmed because of all the enormous debt-financed countermeasures being conducted worldwide."

Official figures released in Germany this week showed inflation in March slowed to 0.5 per cent, the lowest since July 1999. (dpa)