The European Central Bank (ECB) reiterated, on Wednesday 18 March, its willingness to go further than the measures already taken by using its full range of monetary instruments to counter the economic recession that the euro area is expected to face in 2020 due to the coronavirus pandemic.
“Unanimous”, in a press release, the Governing Council stated that it “stands ready to adjust all of its measures” in order to safeguard liquidity conditions in the banking system and to ensure the smooth transmission of its monetary policy in all euro area countries.
The aim is to remove any doubts about the ECB's willingness to act as lender of last resort, after President Christine Lagarde on Thursday 12 March made ambiguous statements about a possible intervention by the European institution if a euro area country, such as Italy, were attacked on sovereign debt markets (see EUROPE 12445/1).
On Tuesday evening, the European Council endorsed the emergency economic measures to be taken at European level to prevent a collapse of the European economy (see EUROPE 12448/1).
Attending the video conference of the Twenty-Seven, Lagarde said that the health measures adopted in the EU will lead to an economic recession of between 2 and 10 percentage points, the Frankfurter Allgemeine Zeitung reported on Wednesday. (Original version in French by Mathieu Bion)