Twenty years after the start of the Economic and Monetary Union (EMU), the European economy is facing many challenges of different natures. The incomplete architecture of the EMU is at the root of many pressing issues on the political agenda. These include economic policy coordination among members states, tensions arising from the common European budgetary framework and the sometimes problematic relationship between the ECB’s monetary policy and national fiscal policies. See 'Institutions and Politics'
Interacting with these institutional issues is our analysis of the European business cycle. This is affected by both ‘domestic’ and global drivers. ‘Domestic’ factors include policies such as labour and product market reforms, as we have recently seen in France. Another domestic factor is the weak European investment cycle which contributes to the current account surplus of the euro area. Fiscal policy initiatives, and their implications for debt sustainability and government bond yield spreads, are closely monitored as well. More global factors on our watch list include the impact of Emerging Market turbulence and of the ongoing trend of deglobalisation and trade conflicts. See 'Business Cycle'
The high sensitivity of the European economies to global trends explains our special attention for Europe’s international trade relations. Therefore, topics such as the EU’s trade agreements with e.g. Canada and Japan, as well as the pros and cons of a possible (TTIP-like) agreement with the US, are discussed on this theme page. Because of the far-reaching potential consequences of Brexit on the European economy, this topic merits a separate theme in our analysis. See 'International Trade'
Some of the topics mentioned are well specified and/or of a rather technical nature. Other subjects are more conceptual and raise fundamental questions about the future of the European economy. In this theme section, we aim to investigate and shed further light on each of these topics, to underpin our overall view on the European economy.