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In the past few years and months, a number of subsequent shocks have hit the European economies. A combination of high levels of public debt, stagflation as well as the announcement of a joint return to contractionary monetary and fiscal policy could be a challenge for the Economic and Monetary Union given that interest rates on government bonds, in particular in southern Europe, increased substantially in recent weeks. This Forum takes a look at the factors that have contributed to the recent return of interest rate spreads, analyses the new developments in macroeconomic aggregates and considers how the EU should respond to the emerging crisis.

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© The Author(s) 2022

Open Access: This article is distributed under the terms of the Creative Commons Attribution 4.0 International License (https://creativecommons.org/licenses/by/4.0/).

Open Access funding provided by ZBW – Leibniz Information Centre for Economics.

DOI: 10.1007/s10272-022-1077-y