Today’s PMQs will be remembered for one thing, Cameron saying that the eurozone had to ‘make up or it is looking at a potential break-up’. This is a distinct hardening of the government’s line on the single currency.
Cameron’s comment was particularly striking coming just days after George Osborne said that ‘open speculation’ about whether or not Greece would leave the euro was ‘doing real damage across the whole European economy’. However those close to Cameron are not resiling from the remark. Instead, I understand that we can expect more from the Prime Minister on this subject when he makes a speech on the economy tomorrow.
The break-up of the euro would be extremely painful in the short-term. But in the medium-term, it is probably the best thing for the European economy. You can’t deal with an exchange rate crisis within a single currency.