Research Detail
| 2022/05/04 / Erste Group Research |
Croatia on the verge of Euro Area Roughly nine years after joining the European Union, Croatia is on the verge of further EU integration. The timing seems appropriate, as public preferences for introducing the euro are at a record-high level in the country. The historically high degree of business cycle synchronization assures that Croatia is a good fit for the Euro Area. Public preferences for euro adoption in Croatia, compared to other non-Eurozone countries, are high, despite occasional vocal anti-euro initiatives from smaller political parties Euro adoption brings further living standard convergence potential, yet nothing is given, as lasting reform complacency is likely to remain a drag going forward. Croatia remains a textbook example of an ideal candidate from a cost-benefit angle: economic and inflation cycles with the EMU are looking well-synced. Euro adoption brings decreasing macroeconomic risks and additional capacity as far as both monetary and fiscal policy are concerned. The latter is especially true for crisis periods, which seem to be a new normal these days. |
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General information
| Author | Erste Group Research |
| Date | 2022/05/04 |
| Language |  |
| Product name | CEE Economies Special Report |
| Topic in focus | FX, Macro/ Fixed income |
| Economy in focus | Croatia |
| Currency in focus | Croatian Kuna |
| Sector in focus | - |
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