European leaders come together today in what is being billed as a summit to strengthen economic and monetary union.
But at this, the fourth meeting this year, the debt crisis is as usual set to colour discussions as the 27 EU leaders look for a way to restore confidence in the euro.
Either way Germany is expected to come under pressure to support the idea of allowing the European Central Bank to play a more leading role.
Top of the contentious list is closer banking union – which has some backing but details remain controversial. Balancing austerity measures against growth has already split opinion and then there is closer currency union and the impact of a Spanish bailout.
Financial expert Tom Vosa of National Australia Bank said: “What we want to find out is, given the IMF has given everybody a nod and a wink to end austerity, do we see comments about the need for a medium-term fiscal framework and perhaps some sign that policy will be loosened in France, in Germany, in the Netherlands – core Europe, growing Europe. If they can perhaps ease fiscal policy, then the euro zone as a whole might grow a little better in 2013.”
But the EU Commission is resting many of its hopes of securing the euro’s future on the setting up of a single banking supervisor under the ECB. It’s part of the banking union plan aimed at binding the 17 euro zone countries more closely together. But while the EU commission wants it in place by next year, agreement still has to be reached.