Searching for the EMU core member countries

- The paper searches for the EMU core member countries.
- Techniques of cointegration analysis and tests for structural change are used.
- German government bond yields are used as benchmark.
- Bond markets do not seem to believe anymore that France is a core member.
- Austria, Belgium, Finland and the Netherlands seem to be core member states.

This study uses techniques of cointegration analysis and tests for structural change to search for changes to sovereign credit risk in some relevant member states of the European Monetary Union (EMU) trying to identify core countries. While there are a number of core countries the empirical findings presented in this study seem to provide some evidence that might be interpreted as a sign for bond markets not believing anymore that France is belonging to this prestigious group of EMU member states.