By this I mean that monetary unions – which are characterised by the very special combination of a single, centralised monetary policy and many national fiscal policies – require a particular monetary and fiscal architecture.
Yet, there are elevated downside risks, including an escalating trade war, the ongoing Brexit concerns and the geopolitical turbulences in the Middle East. Thus, a much more subdued outcome could well materialise, with ramifications for both Asia and Europe. In the euro area, we have been on a path of recovery and growth since 2013, when the euro crisis had been contained.