Andrei Sterescu
@andreisterescu.bsky.social
EU Economist | Formerly @ecb.europa.eu | European 🇪🇺 and International Economic Policy | Views are my own and do not represent those of my employer Substack: https://open.substack.com/pub/outsample
The ongoing debate over China’s surplus and the value of the RMB has raised interesting questions on what exchange rate adjustments can do to reduce global imbalances. 🧵with my own two cents on China, the RMB and what the Plaza Accord actually achieved. open.substack.com/pub/outsampl...
Plaza, China and the Politics of Adjustment
China’s surplus, Renminbi undervaluation, the contested legacy of the Plaza Accord, and the return of currency diplomacy.
open.substack.com
The ongoing debate over China’s surplus and the value of the RMB has raised interesting questions on what exchange rate adjustments can do to reduce global imbalances. 🧵with my own two cents on China, the RMB and what the Plaza Accord actually achieved. open.substack.com/pub/outsampl...
Plaza, China and the Politics of Adjustment
China’s surplus, Renminbi undervaluation, the contested legacy of the Plaza Accord, and the return of currency diplomacy.
open.substack.com
Useful overview of interventionist economic policies in western Europe after 1945. #TakeBackControl
Andrei Sterescu@andreisterescu.bsky.social · 5d agoFrom the 1980s onwards, neoliberal reforms weakened many of the institutions that governments had used to steer and organise production. Industrial policy never disappeared, but much of the institutional capacity that had once supported it did. A 🧵. open.substack.com/pub/outsampl...
From the 1980s onwards, neoliberal reforms weakened many of the institutions that governments had used to steer and organise production. Industrial policy never disappeared, but much of the institutional capacity that had once supported it did. A 🧵. open.substack.com/pub/outsampl...
How planning shaped Europe’s postwar industrial transformation
Across Western Europe, different forms of economic planning helped coordinate investment, mobilise finance, rebuild industrial capacity, and manage structural change during the postwar decades.
open.substack.com
🔎 What has been driving Romania’s growth since 2010? In our newest publication, we explore the role of imports, exports & demand - as well as the challenges lying ahead. 🔗 Read more: link.europa.eu/y76NDC
1/ Happy to announce that my paper looking at the evolution of Romania’s growth model and macroeconomic policy regime over the past 15 years, using an import-adjusted GDP decomposition approach, has been published on the Commission’s website. Long 🧵.
EU Economy and Finance@eu-economy-finance.ec.europa.eu · 4w ago🔎 What has been driving Romania’s growth since 2010? In our newest publication, we explore the role of imports, exports & demand - as well as the challenges lying ahead. 🔗 Read more: link.europa.eu/y76NDC
1/ In recent days, the EU moved closer to new powers to tax and restrict Chinese goods while reopening formal trade. But Europe’s China problem is not only competition. The industries it wants to defend still depend heavily on Chinese inputs. A 🧵. open.substack.com/pub/outsampl...
China Supplies The Industries Europe is Trying to Protect
China’s role in European manufacturing is larger, more hidden and more concentrated in strategic sectors than trade figures suggest.
open.substack.com
What I find funny here is that the FT doesn’t argue that Chinese industrial policy is ineffective. If anything, it acknowledges China’s success in some sectors. What it says is that Western countries should be cautious about emulating China because they lack the capacity to do so.
Always nice when your analysis finds a wider audience. Data from an article I wrote on Substack mapping how different European regions are exposed to Chinese import competition and US demand got featured in @economist.com this week. www.economist.com/europe/2026/...
A trade war between the EU and China seems inevitable
Europe sees Chinese subsidies, China sees European weakness
economist.com
The @pkrugman.bsky.social and @lugaricano.bsky.social debate centres on whether Europe's relative position depends on how productivity is measured. Using industry-level data, I break the gap down into its sectoral and capital components to see what is driving it. substack.com/@andreistere...
Europe's Productivity Debate Needs Better Data
Krugman is right that Europe's relative living standards have held up better than the decline narrative suggests. His critics are right that America has built a lead in intangible capital and tech.
substack.com
In a recent article, @martinsandbu.ft.com argued Europe already has a huge source of demand through the state. Instead of focusing exclusively on subsidies, R&D, venture capital, or trade protection, governments should use procurement to create markets. giftarticle.ft.com/giftarticle/...
Fomo is a poor motivation for EU tech policy
Europe’s large public sectors are a powerful tool to build a market for native tech
giftarticle.ft.com
1/ Ahead of the EU ETS review and amid rising energy costs several governments and industries are pushing for reforms and a broader rollback of the EU’s climate and sustainability agenda. But is the Green Deal really to blame for EU’s competitiveness problem? A 🧵. open.substack.com/pub/outsampl...
Is the Green Deal Really to Blame for Europe's Competitiveness Problem? Europe’s Energy Crisis, Industrial Vulnerabilities and the Politics of Decarbonisation
The competitiveness case against the EU Green Deal is weaker than often claimed, but the political backlash reflects real and geographically concentrated adjustment pressures
open.substack.com
Was just listening to @abenewman.bsky.social on @fraghi.bsky.social’s podcast and then I see this. Trump reportedly suggesting that the US, China and Russia should co-operate against the ICC. I tried reading from a neo-royalist point and how it link to hegemony.
War on Iran is changing the currency calculations of Gulf energy exporters. But the dollar’s global role depends on far more than the denomination of a barrel of oil: ft.trib.al/sqJUidM
There's a global race to secure EV battery gigafactories & reduce reliance on China. But not all clean-tech projects are created equal. Some generate good jobs & domestic capacities, others produce ecological harm & low value-added enclaves. New paper & thread 👇 www.tandfonline.com/doi/full/10....
Given the persistent disruptions from the closure of the Strait of Hormuz, @cronco.bsky.social and I have written a substack article about how Europe’s fossil fuel dependence is now as much about macroeconomic resilience as climate. A 🧵. #Iran #Inflation #Energy open.substack.com/pub/outsampl...
The Iran War, Energy Price Shocks, and the Green Transition
The Iran War and the closure of the Strait of Hormuz strengthens the economic case for accelerating decarbonisation and reducing exposure to fossil fuels.
open.substack.com
New QJE paper measures spending flows between 1000s of small groups of consumers and producers, government, rest of the world. Most consumer spending stays domestic, esp in rural, older, less-educated areas->higher fiscal multipliers; targeting "left-behind" groups boosts economy
NEW: "Europe’s dependence on US foreign military sales: evidence for policy makers from a new database. " Our latest academic article with @juanmejinoecon.bsky.social www.tandfonline.com/doi/full/10....
Europe’s dependence on US foreign military sales: evidence for policy makers from a new database
Public concerns about Europe’s dependence on the United States military industrial base have increased with the worsening security situation in Europe and the deterioration of the transatlantic rel...
tandfonline.com
The ECB should avoid rushing into rate hikes in response to surging energy costs unless there is clear evidence of second-round effects that could make inflation more persistent. Otherwise, it risks jumping the gun, weakening growth, and doing little to address the underlying problem.
Reuters Legal@legal.reuters.com · 4mo agoThe European Central Bank should not rush to raise interest rates to combat a surge in inflation and should instead take time to analyse whether the jump is becoming entrenched, board member Isabel Schnabel said on Friday.
Through 2024 and 2025, euro area spreads narrowed steadily as ECB easing cumulated and confidence in euro area convergence improved. By late 2025, spreads had narrowed considerably. Now that is beginning to change.
Andrei Sterescu@andreisterescu.bsky.social · 5mo agoHistorically, major geopolitical shocks often pushed investors into Treasuries and Bunds and compressed yields. Since, 2022, government bonds on both sides of the Atlantic are having their safe haven status tested as geopolitical risks have lifted energy prices and inflation expectations.
Ann Pettifor: "Tackling inflation with rate hikes while refusing to take regulatory action to deal with spiralling food prices, rocketing profits and falling real wages - means central bankers are acting politically." @annpettifor.bsky.social open.substack.com/pub/annpetti...
War, Inflation and Central Banker Threats to The Global Casino
The Insanity of central bankers doing the same thing over and over again
open.substack.com
Since the US and Israel attacked Iran, Brent crude has risen above $100 a barrel, gas prices have more than doubled and tanker traffic through the Strait of Hormuz has collapsed. A thread 🧵 on global currencies, bonds, energy markets and geopolitical risks (GPR). open.substack.com/pub/outsampl...
Currency Power and Geopolitical Risk
The Iran crisis as a lens on how geopolitical shocks move through energy markets, international currencies, government bonds, and the euro area’s structural vulnerabilities.
open.substack.com
Modern wars are shaped as much by markets and supply chains as by what happens on the battlefield. A conflict can become longer and more dangerous by feeding through oil prices, shipping disruptions, inflation, and bond market stress, especially in a system loaded with debt and fragile investors.
Aurélien Goutsmedt@aurelien-goutsmedt.com · 5mo ago"As analyst Luke Gromen put it in a recent newsletter, 'Iran does not have to defeat the US military; it just has to defeat the UST market', the idea being that a serious bond market downturn would force the US to pull back." www.ft.com/content/d2b2...
5/ important note: in a high oil price scenario, countries that produce lots of oil are NOT necessarily protected from effects of high oil prices. If your country’s oil industry is a commercial one that is allowed to export & not under heavy state control, yr citizens pay the global price tra la
Europe’s right-wing populists may be personae non gratae among the political establishment back home. But in the U.S. they are being greeted with open arms and access to the top. 🔗 www.politico.eu/article/maga...
Fascinating to watch 🇫🇷, then 🇬🇧, then 🇮🇹, now 🇩🇪 start to acknowledge what 🇪🇸's government recognised from the very start: the Trump-Netanyahu war on Iran is a reckless intervention conducted without regard for rules of war and without a strategy for what comes next. www.bloomberg.com/news/article...
Merz Warns of Economic Damage Due to ‘Endless’ War Against Iran
German Chancellor Friedrich Merz warned the US and Israel against waging an “endless war” against Iran that could lead to the disintegration of the whole Middle Eastern state, a new migration crisis i...
bloomberg.com
The US-Israeli attack on Iran, with its destabilising economic & security effects on Europe, just underlines my point: the UK shdn't stay leashed to a dangerously unpredictable US that doesn't even calculate its own interests, let alone ours, before bombing. And the EU wd be stronger with the UK.
Centre for European Reform@centreeuropeanref.bsky.social · 5mo agoAccording to @cerianbond.bsky.social, co-operation between London & Brussels should focus particularly on shared economic and security interests, including strengthening European strategic autonomy. buff.ly/bBu3Y5M
German Chancellor Merz spent the past two weeks travelling first to Beijing and Hangzhou, then heading to Washington a few days later to meet Trump. Merz’s itinerary functions as a crude but accurate map of Germany’s external exposure. open.substack.com/pub/outsampl...
SCOTUS decided the President cannot impose tariffs under the International Emergency Economic Powers Act. The #tariffs decision doesn’t stop Trump from imposing duties under other laws. While those have more limitations, the tariffs framework could remain largely in place.
