Emu: No More Ifs Or Maybes

As the Bundesbank calls the tune, Europe Inc. gets ready

Until recently, it was still fashionable in some European circles to voice doubt about whether monetary union would really happen in 1999. Last week, Germany's central bank put an end to all that. When the Bundesbank raised short-term interest rates and four other central banks instantly followed suit, it was a strong signal that EMU is already a reality in the minds of Europe's financial powers. And the Buba made clear that it will call the shots as financial union approaches. Until a new European central bank is created in 1999, the Bundesbank will be its proxy. "This is the European central bank in operation," says Allison Cottrell, an economist with PaineWebber International (UK) Ltd. in London.

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