The Challenging Cliff-Edge
From an economic policy viewpoint, the harder part will come once the pandemic is over. The crisis will leave many scars that are likely to significantly slow growth down. Countering these effects will require continuous and well-targeted fiscal policy support. Monetary policy, which provided adequate support during the crisis, will have to eventually normalise its interest rates. The ECB could play a crucial role in reducing the large debts that fragilize several member countries. This paper was provided by the Policy Department for Economic, Scientific and Quality of Life Policies at the request of the committee on Economic and Monetary Affairs (ECON) ahead of the Monetary Dialogue with the ECB President on 18 March 2021.
In-Depth Analysis
External author
Charles WYPLOSZ
About this document
Publication type
Keyword
- coronavirus disease
- economic analysis
- economic conditions
- economic consequence
- economic recession
- economic recovery
- ECONOMICS
- EP Committee
- epidemic
- EU institutions and European civil service
- European Central Bank
- EUROPEAN UNION
- FINANCE
- financial institutions and credit
- financial stability
- fiscal policy
- free movement of capital
- health
- interest
- monetary economics
- public debt
- public finance and budget policy
- single monetary policy
- SOCIAL QUESTIONS
- taxation