The monthly €80 billion ECB’s quantitative easing, harmful internal reforms and high public deficit have not helped the French manufacturing sector which has contracted for the third straight month in May, even if the reading was insignificantly higher than expected. The Markit Eurozone Manufacturing PMI posted a three-month low in May. The euro area has stuck in stagnation and France has joined Greece as a main concern.
Mario Draghi’s policy did not prevent the widening of the economic gap between Germany and France. PMI data shows that both the imbalance between the two countries and Germany’s power within the monetary block have increased. From the latest PMI data one can conclude that the cheap euro improves German economy while it cannot prevent France from falling further behind. While Germany’s ruling elite are voicing a vehement opposition to the ECB’s policies, it is absolutely clear that the Paris Establishment are not amused by the result. Continue reading
Greece may be about to get some debt relief, although there is still resistance to the idea. This column argues that the ECB has been providing other Eurozone countries with debt relief since early 2015 through its programme of quantitative easing. The reason given for excluding Greece from the QE programme – the ‘quality’ of its government bonds – can easily be overcome if the political will exists to do so. It is time to start treating a country struggling under the burden of immense debt in the same way as the other Eurozone countries are treated.
