Europe Government

  • 2018-12-07 07:49


    By Luke Heighton

    FRANKFURT (MNI) - Brexit will likely lead to a de-liberalization of trade in services and a drop in real consumption for both the UK and Europe -- regardless of any bilateral agreements reached, a study published by Germany's Bundesbank claimed Friday.

    Here are the key points from the paper (which do not necessarily reflect the opinion of the Deutsche Bundesbank or the Eurosystem).

    -- In the event of a hard Brexit with no preferential market access for services between Britain and the EU, the UK would experience a 0.33% drop in real consumption, simulations based on 2014 data showed.

    -- Real wages and real dividends in service sectors would see falls of a similar order, averaging 0.38% and 0.32% respectively.

  • 2018-11-23 09:27


    By Luke Heighton

    FRANKFURT (MNI) - Talks over the eurozone's Capital Markets Union and the completion of the Banking Union are being held up by "technical nit-picking, with self-satisfaction from some, disparagement from others, and distrust on all sides", the head of the Central Bank of France said Friday.

    However Paris stands ready to inherit London's role at the centre of the global derivatives market as Europe restructures its financial system post-Brexit, Francois Villeroy de Galhau added.

    Here are the key points from the speech in Paris:

    -- Banque de France analysis supports research by the ECB and the Bank of England which did not identify any major risks to eurozone financial stability from an orderly Brexit.

    -- In the event of a No-Deal Brexit, the c

  • 2018-10-26 12:45


    By Luke Heighton

    FRANKFURT (MNI) - Central bank independence is under threat, ECB President Mario Draghi said today, as governments are increasingly prepared to favour short-term objectives over price stability.

    Draghi warned of a return to 1970s-style inflationary and price instability if monetary policy were to become subject to political pressure.

    His remarks come amid growing concerns over the destabilising effect of Italy's budget negotiations with the EU, and in the wake of President Donald Trump's recent attack on the Fed,

    Here are key points from the speech at the National Bank of Belgium in Brussels:

    -- Outside the eurozone we see concerns being publicly expressed about whether the central bank should pursue a normalization path in the face of rising

  • 2018-08-22 07:26


    By Luke Heighton

    LONDON (MNI) - Harald Mahrer, former Austrian finance minister and current president of the economic council has been named as President of the National Bank of Austria's (OeNB) General Council.

    Mahrer, a member of chancellor Sebastian Kurz's conservative Austrian People's Party (OVP), will take up the role on Sep 1, alongside his newly-appointed deputy, Barbara Kolm, an economic advisor to the right-wing populist Freedom Party of Austria (FPO).

    They replace current president and People's Party pick Claus Raidl, along with Social Democratic Party (SPO) nominee Max Kothbauer, whose 10-year terms of office both expire at the end of August.

    The General Council supervises operations lying outside the remit of the European System of Central Banks (ESCB)

  • 2018-05-30 03:30


    --Lega, 5 Star Coalition Push To Reconsider Their Alliance

    ROME (MNI) - There are high chances Italy may be holding a second vote as early as July following calls from political parties though much will depend on the decision of the head of state Sergio Mattarella, MNI understands.

    Sources close to both Lega and the Democrat party told MNI that at this stage, and election was a better option. "The earlier we vote again, the better it is. There is no sense having a cabinet running for just a few months anyway," said one source close to the League.

    Mattarella is meeting with prime minister designate Carlo Cottarelli, a former IMF official, who is expected to present his list of ministers later Wednesday for approval.

  • 2018-05-24 05:26


    -Says ECB QE Focused On Inflation Progress And Target

    BRUSSELS (MNI) - European Commission Vice President Valdis Dombrovskis said today it was up to the European Central Bank whether it remained appropriate to continue to buy Italian sovereign bonds in light of the spread widening seen in the wake of the new governing coalition's increased spending plans.

    Questioned on the ECB's continued asset purchase program as regards Italy, Dombrovskis replied that the ECB's QE program had an inflation target at its core. There was also a question of eligibility of Italian bonds, but that too was a question for the ECB to determine.

    "The ECB's QE aim is to bring inflation close to its target of close to but below 2%.

  • 2018-05-14 02:41


    By Chris Mc Innes

    LONDON (MNI) - Unions and employers in Germany's construction sector on Saturday agreed on the steepest wage increase negotiated so far this year. The deal was brokered through arbitration proceedings, which became necessary after initial talks ended in deadlock in April.

    Confirming MNI's analysis published May 8 (MNI ANALYSIS: German Wages Could Disappoint Wage Round Hopes), the agreement, which covers over 800,000 workers, will ensure pay packets in west Germany increase 5.7% and those in east Germany increase 6.6%. The deal will run 26 months and includes a number of one off payments.

    The deal comes on the heels of similarly generous wage settlements in the metal and public sectors, together covering almost 6 million workers.

  • 2018-05-08 06:39


    By Chris Mc Innes

    BERLIN (MNI) - Wage growth in Germany is expected to accelerate this year, according to government forecasts published last month, but they could still fall below expected levels as the impact of mass awards diminishes.

    Despite wages seemingly gathering steam, early worker celebrations might be overblown. Indeed, wage agreements at branch and company level now only cover about 60% of employees, down from 75% twenty years ago and the impact of these wage rounds on overall wage growth might therefore be more subdued.

    The German government expects wages to grow 2.9% in 2018, up from 2.6% in 2017, driven by the increasing tightness in the labour market.

  • 2018-04-17 09:00


    --IMF See Eurozone '18 Annual Growth At 2.4%, Above Oct 1.9% Fcast

    BERLIN (MNI) - Growth in the Eurozone is expected to accelerate this year before softening in subsequent years. The upswing is set to be supported by strong domestic demand, low interest rates and a thriving external sector, the International Monetary Fund said Tuesday.

    The Fund forecasts GDP growth of 2.4% this year and 2.0% next year in its World Economic Outlook. That compares with a January forecast update of 2.3% and 2.0% for 2018 and 2019 respectively.

  • 2018-04-04 11:20


    --Adds paragraphs at end

    ROME (MNI) - Complex initial talks between Italy's political parties will take place over the next two days to help President Sergio Mattarella determine whether there is solid ground to form a new government, with a second vote still on the table as an option of last resort.

    "The last thing Mattarella wants is for the country to go back to the ballot boxes in such a short timeframe, so he will vet all imaginable scenarios trying to identify key figures for the role of next prime minister," Sergio Fabbrini, head of LUISS University's School of Government, told MNI.

    "But without agreements between parties all his attempts will be void," Fabbrini added.

    On Wednesday and Thursday all parties and parliamentary leaders will b