Economic studies

News and media

The “Uberisation” of GDP?

The latest US economic data raises a serious question of coherence. On the one hand, a fast-paced rise in employment. On the other, the volume of economic activity as measured by GDP is very sluggish, resulting in the apparent virtual stagnation of productivity over the past few quarters. This is even more surprising given the talk around the growth of the digital economy.


News and media

Aligning France's economy with the three “stars”

All three "stars", the oil price, the euro exchange rate and interest rates, are currently aligned: since summer 2014, the crude price has halved and the euro/dollar exchange rate has shed nearly 20%; nominal interest rates are at an all-time low and the French state is even borrowing at negative rates on maturities up to five years. To what extent can the French economy fully benefit from this favourable astral configuration?

Read the article by Olivier Garnier, Group Chief Economist

Why ECB risks running out of ammunition

04/03/2015 - FINANCIAL TIMES

The European Central Bank’s quantitative easing programme announced in January has been well received by financial markets. Its size (€60bn a month) and open-endedness have positively surprised. The fact that 80 per cent of the bond purchases will not be subject to loss sharing between national central banks has rightly been seen as the price worth paying to get a bigger programme and a wider consensus within the ECB governing council. Indeed, this so-called risk-sharing issue has been overemphasised since all the monetary claims created by the programme will remain a joint and several liability of the eurosystem, whatever the loss-sharing arrangement on asset holdings.
Having said that, the ECB is now close to running out of ammunition. The true constraints on further ECB intervention lie in the 25 per cent issue limit and 33 per cent issuer limit on its sovereign bond purchases.


Cross‐border equity ownership is key to eurozone risk‐sharing

07/30/2013 - FINANCIAL TIMES

According to the new “Brussels consensus”, the only viable solution to lower the risk of balance of payments crises within EMU is by moving closer to fiscal union. There is little doubt that cross‐country ex ante risk‐sharing is required in a monetary union. But it would be ill‐advised to rely on mutualisation mechanisms through fiscal transfers only, as opposed to market‐based mechanisms.

Read the article by Olivier Garnier published in Financial Times

Euro Zone Still Looking for a Handle on Crisis

07/22/2013 - THE NEW YORK TIMES

What if German savers were to help rescue Greece, Portugal or Spain by investing in their state assets and companies rather than bailing them out with taxpayer-backed loans? That novel idea for recycling Berlin’s huge current account surplus, avoiding fire-sale privatizations in the weakest euro zone states and fueling growth in southern Europe comes from the French economist Olivier Garnier.

Read the article