Saturday 21 April 2018

Judge warns of possible German exit from euro

Ambrose Evans Pritchard in Berlin

Crucial hearings on the eurozone's bailout policies at Germany's top court this week could set in motion events that force the country's withdrawal from the euro, a leading judge has warned.

Udo di Fabio, the constitutional court's euro expert until last year, said the explosive case on the legality of the European Monetary Union rescue machinery could provoke a showdown between Germany and the ECB and ultimately cause the collapse of the monetary union.

"In so far as the ECB is acting 'ultra vires', and these violations are deemed prolonged and serious, the court must decide whether Germany can remain a member of monetary union on constitutional grounds," he wrote in a report.

The Verfassungsgericht is holding two days of hearings, though it may not issue a ruling for weeks. The case stems from legal complaints arguing the ECB has overstepped its mandate by financing the deficits of bankrupt states.

Irish Independent

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