Future of the Economic and Monetary Union
18 Pages Posted: 8 Sep 2022 Last revised: 15 Mar 2023
Date Written: September 8, 2022
The present paper contains a brief presentation and analysis, in a historical perspective through the lens of the recent major crises, of the legal framework governing the European Economic and Monetary Union (EMU), as well as current developments and challenges ahead. It is structured in three Sections:
Section I (“Introductory Remarks”) sets out the foundations of the EMU.
The following Section II (“The Impact of the Three Major Crises During the Period 2007-2021”) develops on how the (2007-2009) Global Financial Crisis (GFC), the subsequent fiscal crisis in the euro area and the most recent pandemic crisis have affected the conduct of monetary policy by the European Central Bank (ECB) within the Eurosystem, have led to the strengthening of the Economic Union regarding sovereign crisis management and have led to the creation of the European System of Financial Supervision (ESFS) and the then of the Banking Union (BU), in some pillars of which the role of the ECB is significant.
Finally, Section III (“Current Developments and Challenges”) discusses recent and current developments in relation to the Monetary Union (including the new (2021) monetary policy strategy of the Eurosystem and its implementation amidst the ‘inflation crisis’ in 2022), the Economic Union and the Banking Union (with a focus on the ‘unfinished’ agenda).
Keywords: EMU, ECB, Eurosystem, European System of Financial Supervision (ESFS), Banking Union (BU), Global Financial Crisis (GFC), euro area fiscal crisis, inflation crisis, monetary policy, quantitative easing, new monetary policy strategy, financial stability, macroprudential policies
JEL Classification: E42, E43, E44, E51, E52, E58, F33, F36, F55, G21, G23, G28, K10, K23, K33, N14, N24
Suggested Citation: Suggested Citation