(Bloomberg) -- Welcome to the Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union.
Greece’s new Prime Minister Kyriakos Mitsotakis has his work cut out for him. After a resounding triumph in Sunday’s election, the Harvard- and Stanford-educated premier takes the helm of Europe’s most indebted state just as risks to economic growth mount. Today, euro-area finance ministers may discuss how Greece risks missing its budget targets after his predecessor’s spending spree. Rarely have expectations been so high, and the grace period for a newcomer so short.
What’s Happening
Spenders, Savers | With borrowing costs for many euro-area countries below zero and economic weakness persisting, the currency bloc’s finance ministers are due to discuss their fiscal stance today amid increasing pressure on Germany to spend more. Such calls are likely to fall on deaf ears in Berlin, as in typical EU fashion, those eager to spend shouldn’t, while those who should don’t.
Italian Truce | Big spender Italy will be let off the hook by finance ministers today, after its latest commitments satisfied the Commission that an infringement procedure over Rome’s failure to rein in its debt isn’t warranted for now. The next season of the Fellini-style drama will hit your screens this fall, when the government needs to agree on a budget for next year.
IMF Leadership | On the margins of their meeting today and tomorrow, finance ministers may also discuss who should succeed new ECB president Christine Lagarde at the helm of the IMF. There’s no signs that the continent will waive its traditional claim to lead the Washington-based fund, and Bank of England Governor Mark Carney and former Eurogroup chief Jeroen Dijsselbloem are among the names being floated.
Euro’s Role | If proof were needed that the dollar’s global dominance limits the effectiveness of the EU’s foreign policy, look no further than the Iranian nuclear accord, which is falling apart piece by piece. Finance ministers today are due to discuss how to strengthen the international role of the euro — though none of the proposals on the table seems to be a game-changer.
New Member | Here’s a vote of confidence for the euro: Croatia joined Bulgaria in officially applying for the waiting room to join the single currency and ministers are expected today to issue a statement welcoming the bid. Zagreb hopes to become a member of the euro area as early as 2023.
In Case You Missed It
Privacy Problems | The EU’s General Data Protection Regulation might be good for your privacy, but maybe not so much for catching terrorists. Law enforcement officials complain they’ve had to put probes on ice because they no longer have direct access to a previously public database about registered domain names due to GDPR.
Deutsche Deconstructed | Deutsche Bank as you knew it is no more. The German lender announced a radical overhaul, dramatically shrinking its activities outside Europe and reshuffling its top management. Here's all you need to know about Deutsche’s latest turnaround plan, and here’s the big picture on European banking.
Coal’s Decline | Cheap natural gas, the rising cost of permits to emit carbon dioxide and high renewable-energy output are driving Germany’s decreasing dependence on coal. Echoing the U.S. trend where renewables are beating coal-fired power production despite President Donald Trump’s support for the dirtiest fossil fuel, markets are moving faster than lawmakers when it comes to closing Germany’s coal plants.
Brexit Favorite | Boris Johnson is looking set for a landslide victory over rival Jeremy Hunt in the race to be Britain’s next prime minister. With Johnson saying that he’ll pursue a no-deal Brexit if any further negotiations with the EU fail, British parliamentarians are examining ways to block it, while pressure is increasing on Labour leader Jeremy Corbyn to make remaining in the EU the party’s official position.
Chart of the Day
Europe’s aviation regulator has outlined five major requirements it wants Boeing to address before it will allow the planemaker’s 737 Max to return to service. One of them, about the jet’s autopilot function, hasn’t surfaced previously as an area of concern. Here’s a list of the troubling issues.
Today’s Agenda
All times CET.
- 9:15 a.m. French Finance Minister Bruno Le Maire speaks at Bruegel event in Brussels on euro-area budget
- 9:15 a.m. EU’s employment ministers meet in Brussels to discuss economy of well-being and employment aspects of a climate neutral economy
- 2:35 p.m. EU trade chief Cecilia Malmstrom delivers a speech at a Business Europe event in Brussels
- 3 p.m. Euro-area finance ministers meet in Brussels to discuss post-bailout situation in Greece and Spain, the international role of the euro, Italy’s budget and deepening of economic and monetary union
- 3:30 p.m. Press conference following EU-Ukraine summit. Council President Donald Tusk, Commission President Jean-Claude Juncker meet Ukraine’s President Volodymyr Zelenskiy in Kiev
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