Christine Lagarde, head of the European Central Bank (ECB), stated that the European economy remains reliant on stimulus, comparing it to being "on crutches" supported by both monetary and fiscal policies.
She emphasized that reducing the ECB's emergency coronavirus stimulus program (PEPP) would be premature, citing ongoing uncertainty from the pandemic and the need to monitor financing conditions and inflation. The ECB plans to continue its €1.85 trillion bond purchase program at least through March 2022.
Lagarde also urged EU member states to expedite the activation of the 750-billion-euro EU coronavirus recovery fund to foster a faster and more uniform economic rebound. Despite some positive developments like vaccine rollouts, near-term risks, including more contagious virus variants, persist, with the eurozone economy not expected to fully recover to pre-pandemic levels until mid-2022.
Christine Lagarde Isn’t Done Trying to Fix Europe(current)
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