Link to the University of Pittsburgh
Link to the University Library SystemContact us link
AEI Banner

Macroeconomic imbalances in the euro area: symptom or cause of the crisis? CEPS Policy Brief No. 266, April 2012

Gros, Daniel. (2012) Macroeconomic imbalances in the euro area: symptom or cause of the crisis? CEPS Policy Brief No. 266, April 2012. [Policy Paper]

[img]
Preview
PDF - Published Version
Download (953Kb) | Preview

    Abstract

    Lax financial conditions can foster credit booms. The global credit boom of the last decade led to large capital flows across the world, including large movements of resources from the Northern countries of the euro area towards the Southern part. Since the start of the crisis and more markedly after 2009, these flows have suddenly stopped, creating severe adjustment pressures. This paper argues that, at this point, the common monetary policy can only try to mitigate the unavoidable adjustment by maintaining overall financial stability. The challenge is to strike a delicate balance between providing liquidity for solvent institutions while keeping the overall pressure on for a rapid correction of the imbalances.

    Export/Citation:EndNote | BibTeX | Dublin Core | ASCII (Chicago style) | HTML Citation | OpenURL
    Social Networking:
    Item Type: Policy Paper
    Subjects for non-EU documents: EU policies and themes > Policies & related activities > economic and financial affairs > EMU/EMS/euro
    EU policies and themes > Policies & related activities > economic and financial affairs > economic policy
    EU policies and themes > Policies & related activities > economic and financial affairs > financial crisis 2008-on and consequences/reforms
    Subjects for EU documents: UNSPECIFIED
    EU Series and Periodicals: UNSPECIFIED
    EU Annual Reports: UNSPECIFIED
    Series: Series > Centre for European Policy Studies (Brussels) > CEPS Policy Briefs
    Depositing User: Phil Wilkin
    Official EU Document: No
    Language: English
    Date Deposited: 06 May 2012 19:31
    Number of Pages: 12
    Last Modified: 06 May 2012 19:31
    URI: http://aei.pitt.edu/id/eprint/34852

    Actions (login required)

    View Item

    Document Downloads