EMU

The EMU faces three specific challenges over the next few years; first, on the domestic policy mix; second on the implications of unwinding global economic imbalances; and third on how to manage the queue of potential new members in central Europe. The last has some implications for Britain should the essentially political blockages to EMU membership ever be removed. Most of this essay concentrates on the domestic challenge, not least because the euro like the dollar floats against the rest of the world and because it is domestic policy that dominates all other considerations.