Following the May constitutional court ruling on the ECB’s public sector purchase program (PSPP), the deadline for the required proportionality assessment runs out on 5 August. However, the constitutional court will not issue any formal “assessment of the assessment” on Wednesday.… Read the rest
Germany’s presidency of the Council of the EU starts on 1 July. Rather than forcing a complete change to the topics Berlin had planned to prioritize, the pandemic has reframed many of these issues.… Read the rest
The regional state government of North Rhine-Westphalia (NRW) has put the local district of Guetersloh back on full lockdown today. Schools had already closed again, and as of today, nurseries, cinemas, bars and restaurants, swimming pools and gyms will follow.… Read the rest
After two days of talks, the grand coalition has agreed on a EUR 130bn stimulus package. EUR 120bn will come from the federal budget and 10bn from regional and local authorities.… Read the rest
- The Franco-German proposal for a budget-based recovery instrument is a promising first step, but significant political challenges still loom in H2/2020.
- A unique constellation of factors has motivated Berlin to move, but among the many open questions are reform commitments and repayment modalities.
This piece provides an updated overview of the lockdown exit strategies currently being implemented by selected European governments, and the surrounding politics. Please do not hesitate to contact us if you want to discuss any of the countries mentioned in more detail.… Read the rest
● Today’s constitutional court ruling still allows the Bundesbank to continue participating in the European Central Bank’s (ECB) public sector purchase program (PSPP) – as long as a new ECB decision is taken within three months.… Read the rest
● The governing council of the European Central Bank (ECB) will convene digitally on 30 April.
● While speculation continues about an expansion of its PEPP bond-buying scheme, yet another German constitutional court ruling on Eurozone crisis fighting is expected for 5 May.… Read the rest
● Despite the challenges of the country’s decentralized decision-making system, authorities have managed to deal relatively well with the Covid-19 crisis so far.
● But strong public support for the government’s consensual crisis management should not be misread as providing political credit that could quickly be spent on divisive “coronabonds.”
Proposals from Finance Minister Olaf Scholz to temporarily suspend the country’s constitutional debt brake have been greeted with the usual excitement that tends to surround speculation about German fiscal expansion. Among those who quickly came out in favor of the idea was European Central Bank (ECB) President Christine Lagarde.