But as long as there is no consensus even in the EU, workarounds need to be found. It is therefore a welcome move that German lawmakers have decided to gradually introduce a carbon price for heating and transport as of next year.
That’s the good news. The bad news is that monetary policy alone cannot turn this economy around. As yesterday’s GDP figures reminded us, the supply-side of this economy is in deep trouble. We experienced a technical recession in the second half of the year, and growth for 2019 as a whole was just 0.2%, the worst rate since the Global Financial Crisis.