IMF Staff Country Reports

Euro Area Policies: Staff Report

August 3, 2005

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International Monetary Fund. "Euro Area Policies: Staff Report", IMF Staff Country Reports 2005, 265 (2005), accessed July 12, 2025, https://doi.org/10.5089/9781451813012.002

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Summary

This paper focuses on euro area policies. The monetary policy stance remains appropriate for now. Fiscal policies are falling well short of consolidation requirements, and the area remains insufficiently prepared for the looming demographic shock. Past fiscal policy failures, notably insufficient adjustment during economic upswings, have strained the Stability and Growth Pact (SGP) and EMU’s fiscal framework. IMF staff has welcomed certain elements of flexibility in the SGP reforms while regretting the vagueness and open-endedness of others. Center-led structural reform programs have struggled to deliver.

Subject: Employment, Inflation, Labor, Macrostructural analysis, Oil prices, Price stabilization, Prices, Structural reforms

Keywords: Appreciation, Appreciation pressure, Area trade, CR, EU trade policy, Euro, Europe, Global, Headline inflation, Inflation, ISCR, Medium term objective, Oil price development, Oil prices, Price, Price competitiveness, Price stabilization, Product market, Structural reforms

Publication Details

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