Monday, 17 August 2026Europe · Analysis
Independent · Brussels & Berlin
Topic · Thing
The member states that use the euro, the fiscal rules that bind them, and the debates about completing the monetary union.
Asset manager sees resilient second quarter and fading energy shock keeping 2026 outlook intact, with one more rate hike expected in September before policy reversal in 2027.
The single currency trades above $1.08 as German business confidence recovers and markets price fewer rate cuts, but export sectors warn of competitiveness risks.
Only 13% of employed euro-area workers actively search for a new post versus 19% in the US, but the motivation gap is wider than the participation gap.
Water levels at the Kaub gauge fell to 24 centimetres, the lowest since records began in 1880, threatening nuclear cooling, hydropower and inland shipping across central and eastern Europe.
The European Commission will unveil proposals on Friday to cut capital requirements and ease cross-border mergers, responding to a decade of US dominance in investment banking and capital markets.
May flash estimate exceeds ECB target by more than a percentage point, locking in expectations of a rate hike at next week's meeting while Germany, France and southern members diverge sharply.
Senior economists argue the central bank is misreading stagflation driven by energy costs and risks turning a slowdown into a contraction.
Flash PMI falls to 47.5 in May while input price inflation hits three-and-a-half-year high, forcing ECB to weigh June rate hike against mounting recession risk.
German Chancellor Friedrich Merz honored the former ECB president and Italian prime minister in Aachen, citing his crisis leadership and the 2024 Draghi Report as a blueprint for European renewal.
Social Democrats join far-right opposition to remove centre-right premier after ten months, leaving president to navigate coalition talks amid EU deficit procedure and eurozone aspirations.
The European Central Bank left its deposit facility rate unchanged despite April inflation surging to 3% and the Iran war driving energy costs higher, signalling a June hike remains possible but not guaranteed.
Both central banks meet Thursday with inflation above target but growth weakening; economists expect a pause now and a possible ECB hike in June while the BOE may stay on hold all year.
Markets price a June hike but policymakers insist on meeting-by-meeting approach with Strait of Hormuz blockade creating 'layer cake of shocks' risk
Preliminary Eurostat data shows headline inflation breaching the ECB target in March, driven by a 4.9% jump in energy costs after the Strait of Hormuz closure.
The euro fell to a four-month low below $1.152 as Iran's closure of the Strait of Hormuz sent oil prices soaring, exposing Europe's structural energy vulnerability and widening the policy gap between the ECB and Federal Reserve.
Yannis Stournaras argues narrowed spreads and ECB consensus make common issuance essential for defence, green transition and innovation, but Friedrich Merz remains opposed.
Joachim Nagel argues Europe needs a permanent joint borrowing instrument to finance defence and technology, putting the Bundesbank at odds with Chancellor Merz and marking a historic shift for Germany's central bank.
With inflation at 1.7% and the euro up 14% in a year, the central bank faces competing pressures that could force a shift sooner than markets expect.
Flash estimate shows headline rate dropping from 2% in December while core inflation eases only marginally to 2.2%, leaving the central bank little reason to cut rates further.
The lev disappears on 1 January after a fixed conversion rate of 1.95583 to the euro. Polls show the country almost evenly split, while the outgoing government collapsed weeks before the changeover.
The Balkan nation becomes the 21st eurozone member despite seven elections in four years, a resigned government and warnings that institutional weakness could undermine the currency's benefits.
The central bank revised 2025 growth to 1.4% and signalled a long pause, but Governing Council members are split on whether the next move is up or down.
The ECB kept rates steady while flagging internal divisions over the next move, Norway and Sweden paused their easing cycles, and the Bank of England delivered a quarter-point cut to 3.75% as UK inflation eased.
Flash data from Eurostat shows consumer prices accelerating above the 2% target, with services inflation climbing to 3.5% and core holding at 2.4%, complicating the ECB's rate path.
Central bank officials are debating whether to make euro funding more widely available to foreign counterparts, a move that would mirror China's swap-line network but faces collateral constraints and Governing Council scepticism.
ECB president tells Frankfurt banking congress that dependence on foreign trade and security leaves the bloc exposed to US protectionism and Chinese resource dominance, while internal barriers equal a 100% tariff on services.
With Christine Lagarde due to step down in 2027, Madrid and Berlin, the eurozone's fourth and largest economies, are quietly manoeuvring for the first time to lead the central bank, while a Dutch dark horse lurks.
The European Central Bank kept its key deposit rate unchanged for a third consecutive meeting on Thursday, judging that a modest recovery and sticky services inflation warrant patience despite price growth accelerating to 2.2% in September.
The European Central Bank kept its key rate unchanged for a third meeting, citing resilient growth and inflation near target, while warning that trade tensions and geopolitical risks cloud the outlook.
MEP Fernando Navarrete has held 77 percent of his digital euro meetings with private financial firms since taking the file in July 2024, while civil society groups argue his stance protects incumbent banks.
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