The rules governing the euro and its central bank, the ECB, have been subject to high expectations. Absent a political union, the Economic and Monetary Union (EMU) would be ‘rules-based’. This paper argues that the rules of EMU reflected a mix of ambitions, both politically and economically. Especially the economic debates over EMU have therefore not properly accounted for the fact that the rules also sought to structure the process of European integration, by keeping the Member States collectively in charge. The rules of the euro therefore can be seen to have a constitutional purpose and nature. This paper argues that the constitutional aspect of the rules of EMU is crucial to explain the evolution of the euro-crisis. Over the last year, solutions to the economic problems in the Eurozone created by the pandemic have mostly worked around EMU. This paper then concludes by arguing that these work-arounds will ultimately also become entangled in the constitutional problems of the euro.
Since its creation back in 1998, the European Central Bank (ECB) has gradually evolved both in its role as a core manager of the single currency and by acquiring new roles and tasks. The latter entails most obviously the ECB’s supervisory tasks within the Single Supervisory Mechanism (SSM), as well as its various unconventional measures aimed at saving the euro and pushing for economic policy reforms in the context of the financial and sovereign debt crisis. One dimension of the ECB’s activities that has also increased over time concerns its international cooperation. . The ECB established progressively close cooperation with central banks and financial institutions worldwide, joined relevant international organizations, and participates in various informal international fora and networks. This paper examines the evolution of the ECB’s international dimension with a view to assess its transformative effects and side effects on the ECB of today.
This chapter provides a comparative constitutional analysis of the ECB’s mandate with a view to understanding the role undertaken by this and several other important central banks during and after the great financial crisis (GFC). It discusses the relationship between a central bank’s mandate, its objectives, and tasks, in law and in action. Moreover, it gives an overview of both the formal mandate of the ECB, the FED, the Bank of Canada, and the Bank of England, and how these formal mandates have been implemented. Statutory sources remained mostly unchanged whereas policy actions have reshaped the practical scope of central bank mandates. Monetary policy strategy implements central bank mandates through extra-statutory sources, taking advantage of the flexibility granted to the central bank by their frameworks. The common analytical grid of single versus dual mandate may be revisited, giving full credit to a different macroeconomic environment and interactions with other public policies.