In addition to strengthening banking supervision and breaking the link between banks and sovereigns, the banking union also may allow the development of a deeper single market, although here there are considerable uncertainties and potential risks due to the fact that only a subset of the European Union will be taking the steps towards banking union.
However, considering that forces restraining the economy, such as excessive employment and debt, are still persistently at work, momentum for a self-sustaining recovery will be subdued for some time. Furthermore, uncertainty regarding external conditions, particularly in the IT-related sector, is somewhat rising amid a fall in stock prices in the U.S. and worldwide as well as depreciation of the U.S. dollar.