Coronavirus Pushing EU Towards Federalization
Skerdian Meta • 1 min read
The aim of the EU has been a federal Europe from the beginning. The union has gotten closer until 2016, when Brexit happened. The plans for a stronger union were put on hold, with Brexit and now the coronavius, but the EU is using the coronavirus opportunity to start the fiscal union.
This should be positive for the Euro in the long run. EUR/UD climbed around 35 pips after that. But, with the native movement increasing in Italy, France, Spain, Germany and everywhere, so we will see how the EU will progress, because the next few years will be determinant for the fate of the EU and the Euro.
Comments from the German finance minister on Bloomberg
- Germany needs to take on significant debt in 2021
- We are seeing some good data on the economy
- Germany will need to suspend debt rules in 2021 again
- German budget will be in line with debt rules in 2022
- Recovery measures are the start of a fiscal union
“A source familiar with the matter told Reuters last week that Scholz is working on a budget for next year that would see Berlin take on net new debt of at least 80 billion euros to fund more measures in the fight against the coronavirus.”