Merkel’s challenge – BBH

By FXStreet Analysts at Brown Brothers Harriman explained that German Chancellor Merkel was right. “As the Greek crisis was winding down last summer, she noted that the refugee problem would be even more difficult. And indeed, it is.”

Key Quotes:

“The refugee issue is challenging Merkel’s leadership in Europe. While her trademark has been her sensitivity to swings in sentiment, she has seemed rather tone-deaf in dealing with the refugee crisis.

Her move this week suggests she is still out of step with many of her European allies. Reports suggest that Merkel struck a deal with Turkey without the consent of others. Turkey realizes that it is the key to Europe’s strategy. Europe needs to control its external borders if it is going to be able to allow free movement within the region. Many top European officials see the free-movement within the region as essential to European integration. Without it, some fear that the EU faces an existential crisis.

Turkey has its own agenda. It needs funds to meet the needs of its refugees. It previously asked for three bln euros and this week has asked for another three bln euros. However, what Turkey wants is to be part …read more

Source:: FX Street