Lagarde: ‘Covid will not cause a new euro crisis’ – Economy

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“We will have the new estimates in a few days, but it is very likely that the most favorable scenario is now out of reach and that the fall in GDP will be halfway between the intermediate scenario (-8%) and the more serious scenario, which it’s a little over -12%. “
The president of the ECB, Christine Lagarde, said at the European Youth Event 2020, speaking of the impact of Covid on the GDP of the Eurozone in 2020. The GDP “will drop more than during the great financial crisis: the drop was between -4 and – 5%, now it will probably be double. It will depend on how quickly we exit the lockdowns, on the gradual recovery, on the sectors affected “.

“No, the answer is no,” said the president of the ECB in response to the question of whether the pandemic, causing a heavy debt of some states, will provoke a new financial crisis in the eurozone. “All countries in the world have had to respond by increasing their debt”; Lagarde said. “Budgetary measures have had to be taken, whatever happens. The use of debt is not only recommended, but it is the way forward.”

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