Europe Economics Update Italian prospects remain grim Recent euro-zone developments may have brought Italy back from the brink again. But Italy will still need years of financial assistance from the rest of the region and to go through years of severe... 7th December 2011 · 1 min read
Europe Economics Update Euro break-up will leave no country unscathed We expect a limited form of euro-zone break-up in the next two years to cause widespread economic disruption across the region. And with recent indicators already pointing to recession in a number of... 1st December 2011 · 1 min read
Europe Economics Update Euro-zone Fiscal Monitor (Nov.) The latest fiscal data suggest that Ireland remains on track to meet its budget deficit target for this year. But the near-term outlook for the public finances in Southern Europe is more downbeat. 30th November 2011 · 1 min read
Europe Economics Update Euro-zone Monetary Indicators Monitor (Nov.) The latest monetary data have revealed rising strains in the banking sector as the euro-zone’s debt crisis has deepened. While the ECB has continued to provide banks with liquidity, it has stopped... 28th November 2011 · 1 min read
Europe Economics Update Are euro bonds the answer? Jointly issued euro-zone bonds might represent the move into full-blown fiscal union that could be needed to preserve the single currency area in the long run. But opposition from Germany suggests... 22nd November 2011 · 1 min read
Europe Economics Update Are markets starting to price in a euro break-up? Financial markets seem finally to have started to accept that the euro-zone might actually break up. Regular readers will not be surprised to hear that we think this process has considerably further... 16th November 2011 · 1 min read
Europe Economics Update Will the new Spanish Government steady the ship? Although Spain is in a rather better position than its Southern European counterparts, the next Government still faces huge challenges and is unlikely to overcome them without outside help. 16th November 2011 · 1 min read
Europe Economics Update Is France falling out of the core? Growing concerns about France threaten to take the euro-zone crisis to a new level. If a further rise in bond yields or large bank losses leave France unable to support the periphery, the burden on... 16th November 2011 · 1 min read
Europe Economics Update ECB unlikely to fire the silver bullet The idea that the European Central Bank (ECB) will fire a “silver bullet” into the euro-zone crisis by printing vast amounts of money to prop up the Italian bond market looks optimistic. Not only is... 14th November 2011 · 1 min read
Europe Economics Update Italy needs more than a new government The departure of Silvio Berlusconi may have prompted hopes that Italy has come back from the brink, but we still think that a new government is unlikely to prevent an eventual default. 14th November 2011 · 1 min read
Europe Economics Update Will the ECB come to Italy’s rescue? With Italian bond yields rocketing and European governments struggling to agree on a plan to raise finance, some have pinned their hopes on the ECB as possible lender of the last resort. While the... 9th November 2011 · 1 min read
Europe Economics Update Italy moves closer to the brink Recent developments in Italy, coupled with its deteriorating growth prospects and huge structural economic problems, support our view that the Italian government will eventually default. The huge... 9th November 2011 · 1 min read
Europe Economics Update Draghi makes a dovish start, but won’t up bond purchases The ECB’s decision to cut interest rates by 25 basis points to 1.25% suggests that it is starting to acknowledge the effects of the region’s debt crisis on the wider economy. But, for now at least... 3rd November 2011 · 1 min read
Europe Economics Update Greek referendum episode has let the cat out of the bag However the Greek referendum episode is ultimately concluded, the fact that euro-zone leaders have for the first time openly acknowledged that a country can leave the single currency is a potentially... 3rd November 2011 · 1 min read
Europe Economics Update What next for Greece? The chances of Greece holding a referendum appear to be diminishing and a general election seems likely before long, even if the Government wins Friday’s confidence vote. But whatever the precise... 3rd November 2011 · 1 min read
Europe Economics Update Greek referendum throws whole rescue plan into doubt The Greek government’s surprise decision to hold a referendum on the latest euro-zone rescue package has clearly increased the risks of a bigger and disorderly default on Greek debt and, ultimately... 1st November 2011 · 1 min read
