There have been considerable improvements in the euro area’s governance framework since 2011, but the bloc remains vulnerable to future sovereign and banking crises. The ‘doom loop’ between sovereign and banking risk has been weakened, but remains intact. In his first New Year’s address, Emmanuel Macron vowed to “reinvigorate European ambitions” while appealing to the French public not to be swayed by “nationalists” or “sceptics”. Since his election, President Macron has placed considerable focus on greater European integration.  A key part of Mr Macron’s vision focuses on the capacity of the European Stability Mechanism (ESM), or a new alternative body