EU governments intend to build an elite agency to fight the next economic crisis, but they want to shove the European Commission and Parliament to the sidelines, POLITICO reported. Europe’s policymakers agree on the need to upgrade the eurozone’s bailout arm — the European Stability Mechanism (ESM) — into a powerful new European Monetary Fund (EMF). The Council of the EU, however, is trying to use a backdoor procedure to set up the EMF without resorting to the usual EU legislative process, six EU diplomats told POLITICO.

A top economic adviser to Italy’s anti-establishment Five Star Movement has called on the EU to debate restructuring public debt — comments that could unnerve investors and highlights the unorthodox economic views of the party leading the country’s polls, the Financial Times reported. With three weeks to go before the nation’s general election, Lorenzo Fioramonti, an aide to Luigi Di Maio, the Five Star candidate for prime minister, said the “time is right” for a “conversation” around debt restructuring in Italy and “several other” countries.

KPMG and other leading accountancy firms face serious questions over their work with failed construction firm Carillion after making millions of pounds out of their relationships with the company, British lawmakers said on Tuesday. Lawmakers from two parliamentary committees examining the collapse of Carillion said that KPMG had earned 29.4 million pounds ($41 million) from auditing the contractor’s accounts since the company was founded in 1999.

With the economic recovery well under way in Europe the European Central Bank has cut its government bond purchases by two-thirds. Fair enough. However, it is not reining in its involvement in company debt, Bloomberg News reported in a commentary. The securities now comprise about 20 percent of monthly purchases, up from 7 percent at the start of the program in mid-2016. The total amount could top 200 billion euros ($244 billion) before quantitative easing ends. If it had any self-knowledge the ECB should be aware of the problems it's creating.

Italian lenders set to head two new banking groups being created by merging hundreds of small cooperative banks (BCCs) must be ready to strengthen their capital if needed, the central bank's governor said on Saturday. Italy is forcing its tiny BCC banks to merge and two new groups being formed will undergo an asset check-up this year before moving under the European Central Bank's oversight because of their large size, the International New York Times reported on a Reuters story.

A day after the Bank of England hinted that it could raise interest rates faster than many expected, a run of economic figures on Friday suggest the British economy did not end 2017 as strongly as previously thought, the International New York Times reported on an Associated Press story. Official figures showed a 1.3 percent monthly decline in industrial production in December and a 4.9 billion-pound ($6.9 billion) trade deficit for goods and services, its worst since September 2016.

After some high-profile airline insolvencies in Europe last year, an industry trade body said countries should review bankruptcy laws to reduce the number of stranded passengers, but rejected the idea of a rescue fund to repatriate customers, Reuters reported. Britain’s Monarch and Germany’s Air Berlin both went bust last year, but the process was very different.

The British government said on Thursday that another 101 jobs at Carillion Plc will be cut, as the fallout from Britain’s biggest corporate failure in a decade continues, Reuters reported. The Official Receiver, which manages insolvencies for the British government, said it safeguarded a further 1,221 jobs at the company but 101 roles have been made redundant. The jobs made redundant relate to back-office functions and engineering support roles that new suppliers no longer require, the statement said. So far 2,250 jobs have been saved and 930 job redundancies have been made.

France’s finance minister has hit out at German-backed plans to impose debt writedowns on investors in bailed out countries, warning that the issue was a “red line” for Paris in talks on eurozone reform, the Financial Times reported. Bruno Le Maire told a Politico conference in the French capital on Thursday that France was opposed to any “automatic” mechanism that would force private sector holders of sovereign debt to take losses when a eurozone country applies for a bailout. He said the step would make the euro area more vulnerable and fuel Eurosceptic populism.

A senior German central banker has urged UK banks to hasten their Brexit plans and apply for EU banking licences, warning they could be left “high and dry” if they wait on hopes for an EU-UK agreement for financial services, the Financial Times reported. Andreas Dombret, a Bundesbank executive board member, said on Thursday that he was “sceptical” whether a proposal from Britain’s banking industry for “mutual recognition” would be possible.