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The ECB’s monetary policy stance in perspective

Monetary Policy

Business Cycles

Euro Area

When the ECB started to reduce policy rates - the first cut dates back to June 2024 -, there were rising concerns that the monetary stance might still weigh down on economic activity, at least in the short-term. But how far had that restrictive monetary stance been? Are the shifts in the interest rates sufficient to assess the monetary policy stance or should we also account for the economic context and also for measures taken by the ECB beyond the policy rate?

Christophe Blot, Jerome Creel

The Widening Productivity Gap and the Underperformance of ICT-Intensive Sectors in France

Growth

Productivity

Investment

Over the last three decades, labor productivity increased more rapidly in the U.S. than in Europe. In 2019, hourly productivity in the euro area was 82% of that in the U.S., compared to 98% in 1995

Sébastien Bock, Penelope Gelman

Green and Smart?

Climate Change

Innovation

Environment

While green and smart technologies are essential for reducing emissions, their sustainability depends on optimizing their life cycle, particularly in material sourcing, recycling, and waste management. The blog examines their life-cycle impact and highlights the urgent need for sustainable practices at every stage—from extraction to disposal—to ensure they truly contribute to a low-carbon sustainable development.

What impact does a freeze on the income tax scale have?

Taxation

Purchase power

It would seem that the idea of total or partial freezing of the income tax scale, debated in recent weeks, has been (for the moment) abandoned by the government… With the help of the micro- simulation, we still propose here an evaluation of the budgetary savings that can be expected from such a measure as well as its redistributive impacts.

Should the ECB Revise its inflation target ?

Inflation

Monetary policy

Euro Area

The inflation rate in the Eurozone continues to decline. In February, it dropped to 2.6%, more than two percentage points lower than the August. The inflation rate is still above the ECB 2% inflation target despite the monetary policy tightening implemented since Summer 2022.

Christophe Blot, Francesco Saraceno