Crucial decisions about whether a country can join the euro area depend on questionable discretionary decisions.
The ECB should design a specific tool that will accompany interest rate hikes to neutralise the risk of fragmentation directly for countries facing it, staying within the bounds of the EU treaties and ensuring political legitimacy. We also advocate structural changes to the ECB’s collateral framework to avoid unnecessary uncertainty surrounding the safe asset status of European sovereign bonds.
Even though inflation in the euro area is lower than in the US, three issues make it a lot more difficult for the ECB to control inflation and preserve financial stability. Once again, the limits of EMU architecture are visible and will require a rethink.
What are the implications of prolonged inflation?
Major economies are addressing the challenges brought by digital trade in different ways, resulting in diverging regulatory regimes. How should we view these divergences and best deal with them?
ECB Executive Board Member Philip Lane discusses the outlook for Euro area economies.
A conversation on the global trading landscape.
Although Russia bears the brunt of Western high-tech sanctions, the European Union will face challenges in sectors where it relies on Russian and Ukrainian commodities and technologies.
What is the current state of pensions policy in Europe and how are independent workers treated compared with their traditionally employed counterparts?
Global food production will be sufficient to feed the global population this year. But export bans, high prices and increasing transport cost might prevent vulnerable countries from procuring sufficient food supplies. Measures to ensure global access to scarcer food supplies and to boost grain production are warranted.
The EU’s ambitious emissions reduction targets will require a major increase in green investments. This column considers options for increasing public green investment when major consolidations are needed after the fiscal support provided during the pandemic. The authors make the case for a green golden rule allowing green investment to be funded by deficits that would not count in the fiscal rules. Concerns about ‘greenwashing’ could be addressed through a narrow definition of green investments and strong institutional scrutiny, while countries with debt sustainability concerns could initially rely only on NGEU for their green investment.
The EU is still Russia’s largest trading partner, actually several times bigger than China.