#ECB Challenges

[terjewilliamson]

As of February 19, 2025, the European financial market is resilient amid global economic challenges. The European Central Bank (ECB) continues to gradually reduce interest rates, which helps stimulate economic activity in the region. At the same time, the European Commission is actively working on the implementation of the Savings and Investment Union, aimed at deepening the integration of financial markets and attracting investment. These initiatives are designed to strengthen financial stability and support economic growth in Europe in 2025.

[upcomingtradera]

[feedyourmind1031]

 Economic Overview: Key Market Developments

Critical Update

Sudden market shifts may occur due to significant events. Monitor trading positions and implement risk management strategies during these uncertain times.

Economic Overview

As we enter a new quarter, the market faces numerous challenges. Rising war tensions, de-dollarization efforts, and upcoming elections in the U.S., France, and Iran contribute to the uncertainty. Here’s a detailed analysis of these developments and their potential impacts.

Currency Shifts

Russia’s move to use the Chinese Yuan for international trade and the increase in gold reserves by central banks are noteworthy. While the Yuan may not replace the U.S. Dollar soon, these actions indicate strategic shifts. Gold purchases serve as a hedge against potential currency volatility.

Geopolitical Conflicts

Middle East: The conflict between Israel and Hezbollah in Lebanon has intensified, with Iran warning of severe retaliation if Lebanon is attacked. Daily strikes continue, and countries like the U.S. and Germany have advised their citizens to leave Lebanon.

South China Sea: On June 19, 2024, Chinese coast guard officers attacked Philippine military personnel near the Second Thomas Shoal, escalating tensions. The U.S. has reaffirmed its defense treaty with the Philippines, which could lead to military involvement if violence escalates.

Korean Peninsula: North and South Korea are on edge, with Russia signing a defense treaty with North Korea. Border incidents and threats over South Korea’s potential troop deployment to Ukraine have heightened tensions.

Nuclear Brinkmanship: France and Russia’s nuclear brinkmanship is a significant risk, with both countries attempting to establish deterrent boundaries.

Economic and Market Effects

These conflicts could alter monetary power dynamics and supply chains. Expect increased oil demand and gold purchases as safe-haven assets. Silver demand will also rise due to its military applications.

Diplomatic Relations

Zimbabwe and Zambia: Tensions are high as Zimbabwe aligns more closely with Russia, accusing the U.S. of militarizing Zambia.

Election Updates

Iran: Presidential elections are nearing completion as candidates drop out.

France: The first stage of snap parliamentary elections is complete.

U.S.: The first debate between Biden and Trump was contentious, adding to the uncertainty of the upcoming election.

Natural Disaster Considerations

While not detailed here, it’s crucial to consider the impact of natural disasters on economic activities and implement strong risk management.

Key Market Data and Analysis

Final GDP: Increased from 1.3% to 1.4%.

Unemployment: Fell by 3k more than forecasted, indicating a stronger U.S. economy.

Core PCE: Decreased from 0.3% to 0.1%.

Consumer Confidence: Fell but remained above forecasted numbers.

Housing Market: New home sales dropped significantly, while pending home sales improved slightly but missed expectations.

GOLD

Gold prices remain within a range, with resistance at 2431.705 and support at 2295.536. A bullish trend is expected despite fluctuations.

SILVER

Silver prices showed growth, reaching 29.900 before settling at 29.018. Resistance is expected at 29.900, but an overall upward trend is anticipated.

DXY (Dollar Index)

The dollar index showed growth but may face weakness with the anticipated September rate cut. A bearish outlook is expected.

GBPUSD

The pound remains within a range. With potential rate cuts in both the U.K. and the U.S., significant price changes are unlikely in the near term.

AUDUSD

The Aussie dollar shows upward momentum but needs to break above 0.67142 to confirm this trend. Analysts predict rate cuts only in late 2025, potentially benefiting the currency.

NZDUSD

Similar to the Aussie dollar, the New Zealand dollar shows growth and may benefit from delayed rate cuts until late 2025.

EURUSD

The ECB’s cautious rate cut approach has weakened the Euro. Further cuts are expected but at a slower pace, indicating potential continued weakness.

USDJPY

Despite interventions, the USDJPY continues to grow. Watch for further interventions and economic data to gauge future movements.

USDCHF

The Swiss Franc fell after recent rate cuts. Further rate cuts are uncertain, making the USDCHF volatile.

USDCAD

The CAD showed weakness against the dollar, with analysts predicting further rate cuts. Price consolidation is expected as we await more data.

Stay informed and practice diligent risk management as we navigate these challenging market conditions. More updates to come.

[mariacallous]

Central banks from eight countries—Mexico, the UK, France, Netherlands, Germany, Sweden, Singapore, and China—formed the Network of Central Banks and Supervisors for Greening the Financial System (NGFS) in 2017 to investigate and coordinate a response to climate change. By the end of 2022, the NGFS had over 120 members. However, among these central banks, there were considerable differences in the strategies adopted to account for and address climate change. Most strikingly, climate change has emerged as an unusual area of divergence between the European Central Bank (ECB) and the U.S. Federal Reserve (Fed), despite their historical tendency to adopt similar policy tools, frameworks, and objectives. The Fed limited its approach to climate change to basic climate policy standards or “norms” that recognized some relevance of climate change to achieving its monetary and prudential objectives but avoided any support for decarbonization. In contrast, the ECB better appreciated that climate change raised profound challenges for achieving its central banking objectives. As a result, the ECB adopted proactive climate policy norms that, for example, put in place climate-related criteria for asset purchase programs and far-reaching supervisory interventions to ensure that financial institutions accounted for climate risk.

To understand the ECB-Fed divergence on climate policy, we develop a theoretical framework that describes how new central banking norms are created and become influential in the context of domestic and international pressures. In the initial stage of climate policy norm emergence, broad support across the EU for climate action along with persuasive think tanks, researchers, and other policy entrepreneurs helped push the ECB to endorse new climate-related norms. The founding of the NGFS and the associated cascade of climate-related norms exerted significant pressure towards climate policy convergence across many central banks. However, the deeply polarized and partisan U.S. debate on climate change, stoked by an influential domestic fossil fuel industry, led the Fed to adopt only a modest version of the foundational climate norms—a stark divergence from the proactive climate stance of the ECB.

Given the deep differences in domestic political pressures, it seems unlikely that the climate policy differences between the ECB and the Fed will soon disappear. However, given the international connectedness of central banking, we expect global policy norms to provide sustained pressure towards convergence. In this context, the ECB might scale back some proactive commitments, although it seems unlikely to entirely disavow its current forward-leaning stance. The Fed may also seek a more favorable compromise, such as assuring domestic audiences of climate policy restraint, while cooperating with international peers on less overt regulatory interventions.

Download the full paper here»

[beardedmrbean]

Hufvudstadsbladet talks to Swedish People's Party politicians who say their veteran MP Eva Biaudet is causing a rift in the party following her comments hinting at bringing down the government after numerous racism discussions since the coalition took office.

In June, Biaudet was the only member of the ruling coalition to abstain in a government confidence vote.

Several central Swedish People's Party (SPP) members tell HBL that Biaudet was causing party division, suggesting that Biaudet's statements have made them appear as "racist accomplices".

"Everyone knew that working with the Finns Party was going to be challenging, but to publicly form a faction with the objective of getting the SPP to quit the government is quite special," HBL cites a source as saying.

Helsingin Sanomat meanwhile reports Jani Mäkelä, chair of the Finns Party parliamentary group, on Thursday saying Biaudet should consider leaving the SPP parliamentary group because of her actions.

Interest rate peak?

Will there be more pain in store for mortgage-holders, or is relief on the horizon? Ilta-Sanomat suggests that the worst may be behind as the European Central Bank (ECB) has not hinted at further plans to raise borrowing costs.

The 12-month Euribor rate was 4.05 percent on Wednesday. It has decreased by about ten basis points per month. In early July, the 12-month Euribor reached 4.19 percent.

Interest rates have risen quickly. Just last year the 12-month Euribor reference interest rate — which is widely used to set mortgage interest rates in Finland — was still below one percent last summer.

Strawberry imposters

Many Finns strongly associate strawberries with summer. The juicy berry is also one of the most commonly suspected counterfeit food items in Finland. Helsingin Sanomat's most-read story on Friday looks at foreign strawberries posing as domestic ones, which are often pricier than imports.

Instances of strawberry origin counterfeiting are on the rise in Finland, according to Tomi Pousi of the Finnish Association of Fruit and Berry Growers.

The deception typically involves importing a larger batch of strawberries from a neighbouring country where the growing season is already further along.

"Usually, it's done over the weekend when the authorities are off duty, allowing the goods to be quickly distributed and the berries sold as Finnish produce. It's a rapid operation that's hard to react to and to get samples taken in time," Pousi told the paper.

While the berries' cardboard boxes may offer some clues to suspicious consumers, officials these days check strawberry isotopes to ascertain their origin and weed out fraud. Some 10-20 percent of strawberry samples tested by the Finnish Food Authority turn out to be foreign, according to these tests.

[24worldnewsnet]

Getty ImagesMatthew HenryBBC Sport journalist1 hour agoFormer England and Gloucestershire fast bowler David 'Syd' Lawrence has died at the age of 61.Lawrence, the first British-born black cricketer to represent England, was diagnosed with motor neurone disease (MND) last year.He was appointed MBE in the King's Birthday Honours earlier this month after raising money and awareness of the condition.Lawrence played five Test matches for England and took 625 wickets in 280 matches during a 16-year career at Gloucestershire."'Syd' was an inspirational figure on and off the cricket field and no more so than to his family who were with him when he passed," said a family statement announcing his death.He made his first-class debut for the county in 1981, gaining the nickname Syd after the British bandleader.Lawrence went on to take three wickets on his Test debut against Sri Lanka at Lord's in 1988.A bowler capable of reaching extreme pace, Lawrence did not play again for England until 1991 when he took 14 wickets across three Tests and played his sole one-day international the same summer.However, his career was curtailed by a serious knee injury suffered while playing for England against New Zealand the following winter.He played four County Championship matches in a comeback in 1997 but did not play again in top-level cricket afterwards.After retirement he became a nightclub owner and amateur bodybuilder before being named Gloucestershire's club president in 2022.He continued in the role after his MND diagnosis last year and has been a prominent campaigner to support those with the disease.In an interview with BBC Breakfast in September, Lawrence said he had been inspired by former England and Leeds rugby league player Rob Burrow, who died from the illness earlier last year, and had spoken to Burrow's friend and former team-mate Kevin Sinfield after his own diagnosis.When Gloucestershire won the T20 Blast last year, there were emotional scenes when captain James Bracey presented Lawrence with the trophy.Gloucestershire's players and supporters wore pink during a 'Pink4Syd' day during a T20 on Friday.Lawrence recently released an autobiography, In Syd's Voice - The Extraordinary Life of Syd Lawrence, which shares the highest points of his career and intimate moments and memories of his life.He leaves wife Gaynor and son Buster, a former professional rugby union player."A proud Gloucestershire man, Syd took on every challenge with everything he could and his final contest with MND was no different," his family added."His willingness to encourage and think of others right up to the end was typical of the man he was."Getty Images'A pioneer, a mentor, and a symbol of resilience'Gloucestershire said they were "deeply saddened" by the passing of "a club icon - known for his thunderous run-up, fearless fast bowling, and ever-present energy".They described him as "a pioneer, a mentor, and a symbol of resilience" and added that "his contributions will never be forgotten".Lawrence took 477 wickets at 31.27 in 170 first-class matches for the county, with a best of seven for 47 against Warwickshire."Firstly, everyone at the club sends their heartfelt condolences to Syd's family who supported him so well during his illness. As a club, we will support them in any way we can," said Gloucestershire club chair Peter Matthews."Syd was truly a Gloucestershire great, both on and off the field. As a player he was one of our greatest ever fast bowlers, who deservedly earned Test caps whilst with us."On retirement, he continued to be heavily involved with the club, and was both a supportive and active president. He will be hugely missed."Gloucestershire chief executive Neil Priscott added: "He was passionate about the power of cricket and how our sport can touch people's lives. "Syd pushed us to reach out to communities far and wide and we shall continue to do that in his honour."The England and Wales Cricket Board (ECB) also paid tribute to a "pioneering fast bowler whose career and character left a

[techit-rp]

Currency & Bond Markets React to a Weakening USD

The U.S. Dollar (USD) has long held the throne as the world's primary reserve currency, influencing everything from trade flows to emerging market capital. But as we enter a new global economic cycle—shaped by slowing U.S. growth, shifting interest rate dynamics, and increased geopolitical risks—the dollar has begun to lose some of its strength. And the ripple effect is being felt strongly across currency and bond markets worldwide.

In this blog, we’ll dive into how global markets are reacting to a weakening USD and how professionals can better understand these movements through the Best Financial Modelling Certification Course in Chennai.

Why is the USD Weakening?

There are several key factors driving the recent decline in the U.S. dollar:

Federal Reserve Pivot: After aggressive rate hikes, the Fed is signaling a pause or even potential rate cuts to support growth. Lower interest rates reduce the yield appeal of USD-denominated assets.

Global Dedollarization: Countries like China, Russia, and BRICS members are increasing bilateral trade in local currencies, reducing dependence on the dollar.

Widening Fiscal Deficit: The U.S. government’s expanding fiscal deficit has raised concerns about long-term dollar sustainability.

Weaker Economic Outlook: Softening job data, falling consumer sentiment, and slowing GDP growth are dampening investor confidence in the dollar.

Impact on Currency Markets

A weakening dollar sends waves across global foreign exchange markets. Here’s how:

✅ Emerging Market Currencies Gain

Countries like India, Brazil, and Indonesia often benefit from a weaker dollar as it reduces their import bills and attracts foreign investment into local assets. The INR, for example, showed resilience despite rising oil prices—thanks in part to dollar weakness.

✅ Euro and Yen Recover

The euro and Japanese yen, which suffered during the Fed’s rate hike cycle, are now regaining ground. With the ECB staying hawkish and Japan intervening to support the yen, traders are shifting away from USD.

✅ Crypto Market Rises

Bitcoin and other major cryptocurrencies often rally when the dollar weakens, as investors look for alternative stores of value. The digital asset market has surged in parallel with USD softness.

Impact on Bond Markets

📉 U.S. Treasury Yields Drop

As the Fed hints at rate cuts, U.S. bond yields are falling. Lower yields reduce returns on Treasuries, pushing investors toward riskier or higher-yield markets.

🌍 Surge in EM Bond Demand

Emerging market bonds become more attractive when the dollar weakens. Investors seek higher yields in India, Mexico, and South Africa—especially in local currency debt.

🔄 Currency Hedging Gets Complex

Bond investors now face complex FX-hedging decisions. Hedging costs increase when currency volatility rises, making financial modelling skills more important than ever.

Why Financial Modelling Matters More Than Ever

In a volatile macro environment, understanding currency and bond market interactions is no longer optional—it’s essential. That’s where financial modelling comes in.

With proper financial models, analysts and traders can:

Forecast currency movements and assess hedging costs

Simulate bond price/yield relationships under different scenarios

Build interest rate sensitivity models (Duration, Convexity)

Conduct scenario analysis for EM bond portfolios

Evaluate FX impact on MNC balance sheets

For those based in Tamil Nadu, the Best Financial Modelling Certification Course in Chennai offers the right blend of global finance theory and practical skills to navigate these challenges.

What You’ll Learn in the Best Financial Modelling Certification Course in Chennai

Here’s what a strong course will offer:

Core Financial Concepts: Time value of money, fixed income instruments, FX basics

Excel & VBA Proficiency: Building dynamic models and macros

Bond Valuation Techniques: Yield curve modelling, bond pricing, interest rate modelling

FX Hedging Strategies: Forward contracts, options, swaps

Macroeconomic Scenario Modelling: Linking inflation, interest rates, and currency movement

Whether you’re a finance student, analyst, or aspiring trader, this course helps bridge the knowledge gap between theory and real-world applications.

Career Roles That Demand These Skills

Fixed Income Analyst

Currency Strategist

Treasury Analyst

Global Macro Research Associate

Risk Management Consultant

All these roles require you to not only understand market moves but also quantify and forecast them—something financial modelling helps you do.

Final Thoughts: Riding the Waves of a Shifting Dollar

The dollar’s dominance isn’t vanishing overnight, but its recent weakening has opened new opportunities—and risks—in global financial markets. From appreciating EM currencies to changing bond yield dynamics, we are witnessing a macro reset.

In such a landscape, professionals who understand and can model currency and bond interactions will stand out.

If you're looking to gain a solid foundation in these areas, consider enrolling in the Best Financial Modelling Certification Course in Chennai. It’s your gateway to mastering financial complexity in a world of shifting currency tides.

[sportsnewsofficial]

England Cricket Board officially unveil Virat Kohli as their player

The England and Wales Cricket Board (ECB) has shared a special post for their IPL 2025 winners, featuring Virat Kohli, that left one and all in splits. On June 3, the Royal Challengers Bengaluru (RCB) defeated Punjab Kings (PBKS) by six runs in the IPL 2025 final to lift their maiden title in Ahmedabad. England’s Phil Salt, Liam Livingstone, and Jacob Bethell were part of Royal Challengers…

[lmforexpro]

The interest rate decision of the ECB of the European Central Bank and American data to increase fluctuations

Here is what you need to know on Thursday June 5: The main pairs of currencies fluctuate in weekly trading channels early Thursday. The ECB of the European Central Bank will announce monetary policy decisions and the United States economic agenda will provide job discounts in Challenger for the month of May, to read the weekly complaints of initial unemployment, as well as the commercial scale…

[thousandflowerscampaign]

Greece Financial Crisis

The 2008 financial crisis had a severe impact on Greece, but the country’s most acute banking and debt crisis occurred later, peaking in 2015 with capital controls and a bank withdrawal ban. Here’s what happened:

Background: Greece’s Debt Crisis (2008–2015)

2008 Global Financial Crisis hit Greece hard, exposing its high debt and deficit levels.

2009: Greece revealed its budget deficit was much higher than previously reported (reaching 15.6% of GDP), leading to a loss of market confidence.

2010: Greece received its first bailout (€110 billion) from the EU, ECB, and IMF (Troika), but with strict austerity measures (tax hikes, pension cuts, layoffs).

2012: A second bailout (€130 billion) was approved, along with the largest sovereign debt restructuring in history (private creditors took a 53.5% “haircut”).

2015 Crisis: Bank Runs & Capital Controls

January 2015: The left-wing Syriza party won elections, opposing austerity and renegotiating bailout terms.

June 2015: Negotiations with creditors stalled, raising fears of a “Grexit” (Greece exiting the euro).

Bank Runs: Fearing a euro exit and bank collapses, Greeks withdrew over €40 billion from banks in early 2015.

June 28, 2015: The Greek government closed banks and imposed capital controls to prevent a complete financial collapse.

Bank Withdrawal Ban & Capital Controls

ATM withdrawals limited to €60 per day (later eased slightly).

Transfers abroad banned without special permission.

Pensions restricted to limited cash withdrawals.

Businesses struggled to pay suppliers, leading to shortages in some sectors.

Aftermath

July 2015: Greece accepted a third bailout (€86 billion) with more austerity, avoiding Grexit.

Capital controls lasted until September 2019 (over 4 years), making Greece the longest case in the eurozone.

Banks suffered massive losses, and many Greeks lost trust in the financial system.

Why Did This Happen?

Loss of confidence in Greek banks and the euro.

Fear of currency devaluation (if Greece returned to the drachma).

Political uncertainty during negotiations with creditors.

The crisis highlighted the fragility of Greece’s economy and the challenges of being in the eurozone without full fiscal control. Even today, Greece’s banking sector remains weaker than before the crisis.

[angelo-the-whistleblower]

Fun Fact: The difference between Norwegian and French monetary policies:

Question:

The question was: “What is the difference between Norwegian and French monetary policies?”

ChatGPT Answer:

The main difference between Norwegian and French monetary policies lies in the level of independence and the institutions responsible for setting the policies. Here’s a detailed comparison:

1. Monetary Authority

Norway: The Norges Bank (Norwegian central bank) is responsible for setting monetary policy independently for Norway, as the country uses its own currency, the Norwegian krone (NOK).

France: Monetary policy for France is determined by the European Central Bank (ECB) since France is part of the Eurozone and uses the euro (EUR). The Banque de France implements ECB policy but does not set independent monetary policy.

2. Currency

Norway: Norway has its own currency, the Norwegian krone (NOK), and thus full control over its monetary policy.

France: France uses the euro (EUR), and monetary policy is coordinated with 19 other Eurozone countries under the ECB’s governance.

3. Interest Rate Setting

Norway: The Norges Bank sets interest rates to target inflation and manage economic growth based on domestic economic conditions.

France: The ECB sets interest rates for the entire Eurozone, aiming to manage inflation and growth across all member states. France cannot adjust its own interest rates independently.

4. Inflation Targeting

Norway: The Norges Bank targets an inflation rate of 2% over time and adjusts its policy instruments (interest rates, etc.) based on Norway’s economic conditions.

France: The ECB targets inflation for the Eurozone as a whole, with a goal of keeping inflation close to but below 2%. France is part of this broader target but cannot adjust inflation policy just for its economy.

5. Monetary Policy Tools

Norway: The Norges Bank has a full range of tools to manage liquidity and economic stability, including:

Setting interest rates.

Managing the money supply through market operations.

Intervening in the foreign exchange market if necessary to stabilize the krone.

France: The Banque de France implements monetary policy set by the ECB. The ECB uses tools like:

Setting the main refinancing operations rate.

Quantitative easing (QE) and bond-buying programs.

Open market operations for liquidity management. France cannot unilaterally change these policies as they are decided at the Eurozone level.

6. Exchange Rate Management

Norway: The Norwegian krone (NOK) floats freely on international markets, meaning its value is determined by supply and demand. The Norges Bank may intervene in foreign exchange markets if needed to stabilize the currency.

France: The euro (EUR) is a shared currency among Eurozone countries, so France does not manage its own exchange rate. The exchange rate is determined by the overall Eurozone economy and external factors, with the ECB intervening if necessary.

7. Fiscal vs. Monetary Policy Flexibility

Norway: Since Norway controls both its fiscal and monetary policies, it has more flexibility to address domestic economic issues. For instance, Norway can adjust its interest rates, money supply, and government spending to respond to changes in the global economy or domestic conditions.

France: While France has control over fiscal policy (taxes, government spending), it does not have independent control over monetary policy because of the Eurozone’s collective decision-making process. The French government must rely on ECB policies and balance them with its own fiscal decisions.

8. Economic Diversity and Decision Making

Norway: The Norges Bank focuses solely on Norway’s economy when making decisions. Norway’s economy, heavily influenced by oil and natural resources, can adjust its policies specifically to deal with fluctuations in these sectors.

France: The ECB must consider the economic conditions of all Eurozone countries when making policy decisions. This can be a challenge because the needs of France might differ from those of other member countries like Germany, Spain, or Italy.

Summary:

Norway has an independent monetary policy controlled by its own central bank, the Norges Bank, with direct control over interest rates, inflation targeting, and currency exchange rates.

France, as part of the Eurozone, follows the monetary policy set by the European Central Bank (ECB), sharing this policy with 19 other Eurozone countries, and does not have independent control over interest rates or the euro.

This difference in independence is the primary distinction between Norwegian and French monetary policies.

[btcinfonews]

European Central Bank Introduces Digital Euro; Examines Cash Impact

🚀 The Digital Euro is Here: What You Need to Know! 💶

European Central Bank Introduces Digital Euro; Examines Cash Impact

Hold onto your wallets, crypto enthusiasts! 🪙💥 The European Central Bank (ECB) is diving headfirst into the digital age with its hot-off-the-press plan to launch a Digital Euro. This is not just another crypto meme; this may actually redefine Europe’s entire financial landscape. 🌍💰

Key Points to Ponder 🧐

The ECB kicks off plans for a digital euro! 🎉

They’re deep-diving into how cash circulation will change (goodbye cash, hello blockchain?).

Prepare for potential disruptions; it’s time to put on your thinking caps! 🎩💭

But what does this mean for you? Well, if you're still hoarding $cash, you might want to rethink that strategy. The Digital Euro is here to shake things up, and it could be more efficient than a caffeine-fueled coder! 💻☕

Why Should You Care? 🤔

Not only does this initiative have potential to make transactions faster, but it also begs the question: How will this impact your beloved cash? Will our grandmas still have a place to hide their bucks? Only time will tell! ⏳💵

Learning from Chinese Shenanigans 🇨🇳

With China paving the way with their digital yuan, we can look at their experiences as a crystal ball into our future. What challenges and opportunities await? 🤷‍♂️🔮 Comparisons directly from the ECB!

"Our commitment lies in transparency and accountability with the digital euro project." — Piero Cipollone, ECB Executive Board Member

For those wanting a deeper dive into this financial revolution, check out this article!

So, what are your thoughts? Will you embrace the digital revolution, or will you cling on to those crinkly bills? Share your thoughts below! 💬👇

#DigitalEuro #ECB #CryptoRevolution #Blockchain #FinancialFuture #InvestSmart #CryptoNews

[new876868767]

[ad_1] Since he walked into Palazzo Chigi in February 2021, Italians, Europeans, international partners and financial markets had one certainty: Mario Draghi would do “whatever it takes” to get his country back on track. The ex-European Central Bank (ECB) point man has risen to the challenge. He has brought that very same pragmatic approach to the fight against COVID-19, the consequent economic downturn, and the enemies of the multilateral order, strengthening Italy’s role in the EU and multilateral fora in the process.The Italian prime minister leaves Italy in a much better shape than he found it. It is only thanks to Mr. Draghi that The Economist crowned Italy the country of the year for 2021. Indeed, as the British newspaper wrote last December, “it is hard to deny that the Italy of today is a better place than it was in December 2020”. Response to COVID-19Italy’s COVID-19 vaccination rate is among the highest in Europe. Besides, il Bel Paese is set to receive nearly $192 billion (€191.5 billion) from the European Commission’s Next Generation EU, a €750 billion recovery fund designed to boost the bloc’s economic growth hampered by the pandemic. Italy is getting more funds than any other EU country.The Italian prime minister planned to make efficient use of the EU money. In fact, his reform-rich Recovery and Resilience Plan (NRRP) had persuaded European Commission President Ursula von der Leyen to disburse more than $25 billion (€24.9 billion) in pre-financing and the first tranche of over $21 billion (€21 billion) of the total sum. Italy also requested the second tranche, of over $21 billion (€21 billion) too, at the end of last month. These allocations, though, are conditional on Italy meeting the objectives set in the NRRP. So far, the Italian  government has reached all 45 milestones and targets. With Super Mario gone, however, it is extremely unlikely that Italy will continue to do so.According to Istat, the Italian GDP grew by 6.6% during Draghi’s first year in office, the highest rate since 1976. Bear in mind that the eurozone’s third largest economy was the first European country to be hit by the pandemic. However, the Russian invasion of Ukraine has sent energy, food and commodity prices soaring. And as a consequence, the Italian GDP contracted by 0.2% in the January-March quarter of 2022. Italy, the Sick Man of EuropeREAD MOREThe Draghi administration instituted damage control measures to reduce the impact of the war on the economy early on. It is for this reason that Minister of the Economy and Finance Daniele Franco estimated “robust growth” for the GDP in the second quarter in a speech at the Italian Banking Association (ABI). Neither did Franco know nor could he possibly predict that Giuseppe Conte’s party would unleash hell in Palazzo Madama. Conte was Draghi’s predecessor and has been the president of the populist Five Star Movement since August 2021.To understand why Draghi came under pressure, we need some country-specific context. A gifted economist, Draghi took charge of a coalition government to nurse the Italian economy back to life. At the time, Italy was on the brink of collapse due to COVID-19. After Russia invaded Ukraine, economic recovery slowed down and Draghi’s coalition partners saw this as a good time to sabotage him. The center-right Forza Italia of former premier Silvio Berlusconi, the right-wing League of Matteo Salvini and the Five Star Movement led by Conte decided it was time to pull the rug under Draghi.As support collapsed, Draghi resigned. Italian President Sergio Mattarella promptly rejected Draghi’s resignation. This did little to stop markets from panicking. At a time when eurozone inflation is reaching a record 8.5%, the spreads between Italian 10-year government bonds (BTPs) and German Bunds have risen to new highs. On July 20, Draghi addressed the Italian Senate and declared that he was willing to stay on as prime minister if the coalition parties backed his reform agenda. Unfortunately, the above-mentioned parties did not even have the decency to show up in parliament for the vote of confidence. This forced Draghi to resign despite winning the confidence vote.Draghi’s final resignation prompted markets to react even worse than before. The Italy-Germany bond spreads shot up to 243 points. They only started to go down again when the ECB announced it would raise interest rates and launched the Transmission Protection Instrument (TPI), a new tool to tackle financial fragmentation in the euro area.Renewed Credibility and Influence AbroadWith his considerable experience, statesmanlike stature and personal connections, Draghi has restored Italy’s credibility on the European and international stage in his short tenure as prime minister. Thanks to him, Italy successfully led the G20 and COP26 throughout 2021. Italy also (pro)actively participated in G7, NATO, and EU Summits, as well as other high-profile events such as the International Conference on Libya and the Summit for Democracy. Draghi’s deft diplomacy demonstrates how committed he is to strengthening multilateralism and democratic values. As a result, Italy has gained in strength, influence and credibility abroad under his sapient premiership.How the European Union Lost Italy to the Radical RightREAD MOREAs the political crisis unfolded, Super Mario was still hard at work. On July 19, he spoke with Ukraine President Volodymyr Zelenskyy who thanked Draghi for his “significant personal contribution to granting Ukraine the status of a candidate country for EU membership”. The day before, Draghi was in Algeria where he signed several agreements, including an energy deal enabling Italy to reduce gas imports from Russia. The Italian government has signed similar deals with Angola, the Republic of Congo, Mozambique, Egypt, Bahrain, Qatar, Turkey and Azerbaijan.In fact, in May the Trans Adriatic Pipeline (TAP) brought 10 billions cubic meters of gas from Baku, Azerbaijan all the way to Melendugno, Southern Italy in the span of a weekend. Similar negotiations with Israel and Libya are ongoing. By seeking to diversify gas supplies and investing in renewable energy projects, Draghi has been trying to reverse decades of dependence on Russian energy. Following Draghi’s resignation, however, Russia has increased its gas supplies to Italy by 71,4% in just one day.As The Financial Times recently pointed out, Draghi “is (or at least was) shifting the power dynamics within the EU”. Proximity to the Mediterranean Sea and the Middle East and North Africa (MENA) region is no longer perceived as a liability. The risk of increased migration is now trumped by the opportunity of importing non-Russian gas and oil into Europe. Even as Draghi nudged the EU in a new direction, he deepened ties with France, the outgoing president of the Council of the EU. On November 26, 2021, the two EU founding members signed the Quirinale Treaty, a historic deal to strengthen cooperation between Italy and France.The agreement is very similar to the Élysée Treaty between France and Germany which celebrates its 60th anniversary next year. The EU’s biggest economy assumed the presidency of the G7 in January. Yet the post-Angela Merkel traffic-light coalition has struggled to speak with one voice and retain its leadership role in Europe. For all its promises to increase defense spending and deliver lethal weapons to Ukraine, Germany is still very reliant on Russian energy. Hence, it has proved reluctant to suspend the Nord Stream 2 Pipeline and support a full embargo on Russian oil and gas. Until a few weeks ago, Italy was the second largest importer of Russian gas, next only to Germany. Yet the Draghi administration has been bold enough to back all sanctions on Russia proposed by the EU and its North American allies.Stronger Transatlantic TiesOn the other side of the Atlantic, US President Joe Biden and his administration have been looking at Draghi’s Italy with renewed interest and respect. The recipient of The Atlantic Council’s 2022 Distinguished Leadership Award has proved to be a strong leader and a committed transatlantic partner. Is Russia’s War in Ukraine Creating a New European Security Architecture?READ MOREDraghi has been pushing for the development of a strong European defense to complement NATO and took a tougher stance vis-à-vis both Russia and China than his predecessors long before Russia’s aggression against Ukraine began. In his May address to the European Parliament, the Italian prime minister urged greater European coordination on defense. The economist also made the case for more efficient defense spending among EU member states, something that would greatly benefit NATO as well since 21 (soon 23) EU countries are also NATO allies. Unfortunately, Draghi did not have it all his own way though. Despite his calls to increase Italy’s defense budget, the Boot will not hit NATO 2% GDP defense spending target until 2028. Nevertheless, in the eyes of US Defense Secretary Lyloyd Austin, Italy remains “one of Europe’s most reliable security providers”. Last year, Italy celebrated 160 years of diplomatic ties with Washington and also marked 70 years of NATO’s presence on its soil. The country is currently leading the NATO mission in Iraq and is supposed to take the lead of the mission in Kosovo in the fall. Italy’s Eurofighter jets have been stationed in Romania since November 2021 and the country has been supporting NATO all the way from the Baltic to the Mediterranean. In addition, since Russia’s invasion began, Draghi has been striving to provide heavy weapons to Ukraine despite the strong opposition from within his coalition. He has even looked to strengthen defense cooperation with Japan amid concerns that China might be preparing to attack Taiwan.Thanks to this renewed international credibility, Italy has reclaimed its rightful place within the Quint, an informal framework used by the United States, France, Germany, the UK and now Italy again to discuss and coordinate their foreign policy on matters of common interest.Political Mayhem ReturnsDraghi’s premiership has undoubtedly transformed Italy into a power player in Europe and positioned it to be a stronger and more credible ally for NATO and the US. However, as  basketball legend Kobe Bryant once said “Job is not finished”. Draghi needed more time in office to undertake all the reforms envisaged in the NRRP to modernize Italy. Instead, Italy’s best player was fouled by his own teammates and sent to the locker room in the middle of the game. His season is over. Despite not being an elected official, Draghi enjoyed the support of both politicians and ordinary citizens. Since he first tendered his resignation, there have been protests in Italy’s main cities and petitions signed by nearly 2,000 mayors and governors and 100,000 Italians demanding that Draghi stay on in the nation’s top job until the next elections, originally scheduled for March 2023. Now that Draghi has resigned, Italy will go to the polls in September. Sadly, Draghi’s ambitions for Italy clashed with the country’s grim political reality. The notoriously Russian-friendly Five Star Movement, League and Forza Italia are jeopardizing Draghi’s hard-fought legacy of credibility for the country. By behaving so irresponsibly, they are throwing Italy into political and economic instability once again. If Super Mario could not change Italy, then no one else can. The premature ending of Draghi’s government is bad news not only for hardworking Italians, but also for the EU, NATO and Ukraine, who might soon lose a key partner in its fight for freedom. In the Kremlin, on the other hand, this is a cause for celebration because whoever is elected this fall will never be as pro-Europe and pro-US as Mario Draghi.Mr. Prime Minister, you will be missed!The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. [ad_2] Source link