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Overcoming the Gridlock in EMU Decision-Making

Micossi, Stefano - 2020

The completion of EMU, and banking union as its critical component, requires that certain taboos in the policy debate are brought out in the open. First, the Commission must stop pretending that Italian public debt is sustainable under current policies and shift from politically motivated...

Persistent link: https://www.econbiz.de/10012836105

What Do Sovereign Spreads Say About Expected Defaults and Devaluations? An Application to the European Sovereign Debt Crisis

Durham, J. Benson - 2019

This article outlines two general approaches to disentangle expected defaults and anticipated devaluations from distressed sovereign spreads. The first uses affine term structure models and uncovered interest rate parity to extract a schedule between risk-neutral devaluation odds and exchange...

Persistent link: https://www.econbiz.de/10012868618

A Review of European Sovereign Debt Crisis : Causes and Consequences

Ullah, G. M. Wali - 2014

sharp rise in bond yields, CDS, cross-correlation and spillover effects across bond markets of the Eurozone. Yield curves of …

Persistent link: https://www.econbiz.de/10013055160

The Euro and the Geography of International Debt Flows

Hale, Galina - 2014

Greater financial integration between core and peripheral EMU members not only had an effect on both sets of countries but also spilled over beyond the euro area. Lower interest rates allowed peripheral countries to run bigger deficits, which inflated their economies by allowing credit booms....

Persistent link: https://www.econbiz.de/10013055510

Sovereign Debt, Bail-Outs and Contagion in a Monetary Union

Eijffinger, Sylvester C. W. - 2015

The European sovereign debt crisis is characterized by the simultaneous surge in borrowing costs in the GIPS countries after 2008. We present a theory, which can account for the behavior of sovereign bond spreads in Southern Europe between 1998 and 2012. Our key theoretical argument is related...

Persistent link: https://www.econbiz.de/10013027003

On the selling of sovereigns held by the ESCB to the ESM : a revised proposal

Micossi, Stefano - 2021

Persistent link: https://www.econbiz.de/10012798255

Sovereign debt ratings and the country composition of cross-border holdings of euro area sovereign debt

Haan, Leo de; Vermeulen, Robert - In: Journal of international money and finance 119 (2021), pp. 1-23

Persistent link: https://www.econbiz.de/10013284945

The Eurozone Membership Impact on Sovereign Creditworthiness

Sundaram, Rangarajan K.; Wang, Songtao - 2021

We examine the impact of eurozone membership on sovereign creditworthiness over the period 1996-2017. We find that: (a …) the ratings boost was significantly higher in the pre-crisis period (with countries in the periphery of the eurozone being … joining the eurozone, and lowered borrowing costs (as measured by CDS spreads) in line with the ratings boost …

Persistent link: https://www.econbiz.de/10013244814

The Impact of Sovereign Debt Exposure on Bank Lending : Evidence from the European Debt Crisis

Popov, Alexander A. - 2013

Using loan-level data, we find that syndicated lending by European banks with sizeable balance sheet exposures to impaired sovereign debt was negatively affected after the start of the euro area sovereign debt crisis. We also observe a reallocation away from foreign (especially US) markets. The...

Persistent link: https://www.econbiz.de/10013079572

Sovereign debt and its restructuring framework in the euro area

Mody, Ashoka - 2013

To compensate for the inflexibility of fixed exchange rates, the euro area needs flexibility through a system of orderly debt restructuring. With virtually no room for macroeconomic manoeuvring since the crisis onset, fiscal austerity has been the main instrument for achieving reductions in...

Persistent link: https://www.econbiz.de/10009782183