Friday

16th Nov 2018

ECB defends stability and growth pact

Just some days after Romano Prodi called the euro-zone's Stability and Growth Pact "stupid", the European Central Bank, (ECB) revealed an unprecedented statement to defend the pact, saying it was "indispensable for economic and monetary union".

The ECB statement is clearly a response to Mr Prodi’s remarks, but also France said it had no intensions to cut its budget deficit next year in order to meet the rules. The ECB blames the member states for not following the rules. "Problems have arisen not because the rules are inflexible, but as a result of some countries' unwillingness to honour their commitment to respect the rules," the statement said.

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According to the ECB, the results of fiscal policy in several countries are very disappointing. In this context it is important to recall that the main reason why countries are in budgetary difficulties at present is because they have not used the situation of higher growth to substantially improve their fiscal position, announced ECB.

"The game of chicken between the ECB and EU finance ministers continues and it would seem now likely that the ECB will cut rates in December rather than November, given this particular intervention," said economist Julian Callow at CSFB, reports the Guardian.

Italy defiant on budget on eve of EU deadline

Italy would be committing economic "suicide" if it fell in line with EU rules, its deputy leader has said, in a sign that Rome has little intention of bowing to pressure ahead of Tuesday's budget deadline.

Greek austerity violated right to health, says watchdog

Cuts in the Greek health care system, following the austerity cuts demanded in return for international bailouts, have violated the European Social Charter on the right to health, says Council of Europe's human rights commissioner, Dunja Mijatovic.

Analysis

Salvini is gambling with core voters' future in budget battle

Businesses in northern Italy are anxiously watching the standoff between the European Commission and the Italian government. They used to be the 'Northern League's' most important electorate - but the party's profile and priorities have changed.

EU commission eyes majority tax rules

The commission plans to address tax avoidance schemes in some EU states by shifting tax decisions away from unanimity to a majority system in what amounts to a long shot.

EU commission rejects Italy's budget plans

The EU executive has asked Italy to resubmit its budget in an unprecedented rebuke, while warning Rome that public debt was the "enemy of the people".

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