Opposition fails to shake City's EMU prophecy

The upsurge of popular opposition to European monetary union (EMU) in Germany this week, and the legal challenge being pressed in the constitutional court in Bonn have done nothing to shake the conviction in the City that EMU is past the point of no return. It will go ahead next January and almost certainly with Italy in the front rank as well.

The strength of the opposition was highlighted by a letter to the Financial Times from 155 German economists calling for EMU to be delayed "for a couple of years". Meanwhile, the constitutional court has agreed to indicate before the end of February whether it will hear the legal challenge to replacing the mark with the euro. Even if it accepts the responsibility, it is unlikely to give a ruling before the crucial reports from the European Monetary Institute on 25 March and the reports of the Bundesbank and other central banks which will follow. The reports of the Dutch central bank and the Bundesbank represent the last real possibility of delaying EMU, and Italy is the only candidate which central banks could recommend be excluded.