Edition: International | Greek
MENU

Home » EU Actually

Draghi between Scylla and Charybdis

A month after announcing a half-trillion-euro extension of the European Central Bank’s ‘quantitative-easing’ programme and hinting the bank would do little for most of 2017, its president, Mario Draghi, is in the spotlight amid an anti-European Union backlash

By: N. Peter Kramer - Posted: Monday, January 16, 2017

 It has sparked criticism especially in Germany. Recent ECB policies combined with rising inflation are ‘catastrophic’ for Germany, said Markus Soeder, a close ally of Chancellor Angela Merkel. The German economy certainly doesn’t need a stimulus by the ECB. But elsewhere in the Eurozone, criticism focuses on the ECB failure to revive the many sluggish economies.
It has sparked criticism especially in Germany. Recent ECB policies combined with rising inflation are ‘catastrophic’ for Germany, said Markus Soeder, a close ally of Chancellor Angela Merkel. The German economy certainly doesn’t need a stimulus by the ECB. But elsewhere in the Eurozone, criticism focuses on the ECB failure to revive the many sluggish economies.

by N. Peter Kramer

Politicians in Germany, France, Italy and The Netherlands, which all face general elections this year, have recently stepped up attacks on the ECB, complaining it is doing too little, or too much, to support the Eurozone’s €10 trillion economy. In all four countries, mainstream parties face pressure from Eurosceptic challengers expected to win a substantial share of the vote. The ECB president has pledged to ‘keep a steady hand’ through this turbulent political year. Pressure mounts on him to show a next move.

The lack of positive economic prospects across the Eurozone, where unemployment rates vary from more than 20% in Greece and Spain to 4% in Germany, is fuelling nationalist sentiment. While most southern EU member states still stagnate economically, growth in Germany accelerated to a five-year high of 1,9% in 2016, and it posted a budget surplus for a third straight year, the first time that has happened in at least four decades, according to data published last week.

In the Eurozone, inflation surged to a three-year high of 1,1%. It has sparked criticism especially in Germany. Recent ECB policies combined with rising inflation are ‘catastrophic’ for Germany, said Markus Soeder, a close ally of Chancellor Angela Merkel. The German economy certainly doesn’t need a stimulus by the ECB. But elsewhere in the Eurozone, criticism focuses on the ECB failure to revive the many sluggish economies.

Differences between the economies of the Eurozone seem to be unbridgeable by a monetary solution. ‘The euro is threatening the future of the European Union’, Nobel Prize winner Prof. Joseph E. Stiglitz wrote in his book of the same name.

READ ALSO

EU Actually

Respite for Wikileaks founder Assange

N. Peter KramerBy: N. Peter Kramer

Wikileaks founder Julian Assange can stay in the United Kingdom for at least another two months

View 04/2021 2021 Digital edition

Magazine

Current Issue

04/2021 2021

View past issues
Subscribe
Advertise
Digital edition

Europe

From abortion rights to assisted dying: Macron’s 180-degree shift

From abortion rights to assisted dying: Macron’s 180-degree shift

In the latest episode of our Today in the EU podcast, we are looking at how European elections have impacted French President Emmanuel Macron’s policy choices

Business

Artificial intelligence and competitiveness in the retail sector

Artificial intelligence and competitiveness in the retail sector

The importance of AI and machine learning in the retail market is confirmed by the projected dramatic growth of AI services worldwide, which will skyrocket from $5 billion to $30 billion by 2030

MARKET INDICES

Powered by Investing.com
All contents © Copyright EMG Strategic Consulting Ltd. 1997-2024. All Rights Reserved   |   Home Page  |   Disclaimer  |   Website by Theratron