{"id":19256,"date":"2020-02-23T21:34:46","date_gmt":"2020-02-23T19:34:46","guid":{"rendered":"https:\/\/bestinsurance.gr\/a1\/?p=19256"},"modified":"2020-02-23T21:34:46","modified_gmt":"2020-02-23T19:34:46","slug":"ecb-officials-pressure-governments-to-ready-virus-response","status":"publish","type":"post","link":"https:\/\/bestinsurance.gr\/a1\/archives\/19256","title":{"rendered":"ECB Officials Pressure Governments to Ready Virus Response"},"content":{"rendered":"
(Bloomberg) —<\/span><\/section>\n
European Central Bank policy makers from two of the euro area\u2019s biggest economies said governments must shoulder most of the burden for rebooting economies if the coronavirus has a deeper impact on growth.<\/p>\n

France\u2019s Francois Villeroy de Galhau<\/a> and Italy\u2019s Ignazio Visco <\/a>were speaking at the Group of 20 meeting of central bankers and finance ministers in Riyadh, where the threat from the outbreak was front and center.<\/p>\n

\u201cIf we don\u2019t see a rapid V-shaped effect there must be some decision to act in a coordinated way,\u201d Visco told Bloomberg on the sidelines of the G-20. \u201cWe must use fiscal policy because monetary policy is already very very accommodative around the world, and it\u2019s uncertain that we can do more on that.\u201d<\/p>\n

Villeroy said delegates at the meeting spoke a lot about daily monitoring<\/a> and contingency plans, even if the central scenario remains for now a V-shaped recovery.<\/p>\n

\u201cThere was the feeling that if the policy mix needed to be strengthened in the face of coronavirus, it couldn\u2019t be only monetary policy. There is still monetary space but it is more limited than before,\u201d Villeroy told Bloomberg. \u201cIt is even true in the U.S., so therefore questions of fiscal space and structural reforms are back in force.\u201d<\/p>\n

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Trade has been severely disrupted by factory closures in China\u2019s Hubei province, the epicenter of the outbreak, and companies from Apple Inc.<\/a> in the U.S. to Europe\u2019s largest tiremaker Michelin<\/a> have warned that profits could suffer.<\/p>\n

The blow is all the more harsh as G-20 delegates otherwise had reason to see the world economy turning a corner. Villeroy noted<\/span> that \u201cnobody seriously fears a recession,\u201d and the U.S. -China trade tensions that dominated previous meetings have declined.<\/p>\n

\u201cIf there is one concern about the economy at this G-20, it\u2019s coronavirus,\u201d he said.<\/p>\n

Visco said the world economy has two quarters to bounce back from the coronavirus hit before policy makers should unleash coordinated fiscal stimulus. Back-of-the-envelop calculations by finance chiefs at the Riyadh meetings suggest the outbreak could knock by 0.1 percentage point off global growth<\/a> this year, Visco said.<\/p>\n

The hit to the Italian economy<\/a> could be as high as a quarter of a percent<\/span>, reflecting the economy\u2019s integration into global value chains and its reliance on tourism.<\/p>\n

\u201cI\u2019m already worried now but if we don\u2019t see a material improvement by September, I\u2019d be really worried,\u201d Visco said. \u201cYou need two quarters to realize and understand.\u201d<\/p>\n

Visco lent weight to his argument by warning there\u2019s a risk of a \u201cmini de-globalization\u201d if pessimism and fears about further supply-chain interruptions leave the economy suffering for a protracted period. \u201cThis shouldn\u2019t be ignored.\u201d<\/p>\n

Visco said central bankers haven\u2019t discussed joining forces to deliver a coordinated monetary-policy response. The ECB\u2019s deposit rate is already at a record-low -0.5%.<\/p>\n

\u201cIf there\u2019s a need for liquidity assistance, it can be provided through various measures like swaps — of course,\u201d he said. \u201cIf you think about interest rates, it\u2019s much more complicated. There are limits which are not explored.\u201d<\/p>\n

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On climate, Visco said he saw \u201creasoned considerations\u201d at the meeting in Riyadh that it\u2019s important to pay attention to the risks global warming can pose for financial stability.<\/p>\n

\u201cWhat looked quite new two years ago is now almost a G-20 consensus, so this is a very significant move,\u201d Villeroy said.<\/p>\n<\/section>\n","protected":false},"excerpt":{"rendered":"

(Bloomberg) — European Central Bank policy makers from two of the euro area\u2019s biggest economies said governments must shoulder most of the burden for rebooting economies if the coronavirus has a deeper impact on growth. France\u2019s Francois Villeroy de Galhau and Italy\u2019s Ignazio Visco were speaking at the Group of 20 meeting of central bankers<\/p>\n","protected":false},"author":1,"featured_media":19257,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1],"tags":[],"class_list":["post-19256","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-1"],"jetpack_publicize_connections":[],"_links":{"self":[{"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/posts\/19256","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/comments?post=19256"}],"version-history":[{"count":1,"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/posts\/19256\/revisions"}],"predecessor-version":[{"id":19258,"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/posts\/19256\/revisions\/19258"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/media\/19257"}],"wp:attachment":[{"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/media?parent=19256"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/categories?post=19256"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bestinsurance.gr\/a1\/wp-json\/wp\/v2\/tags?post=19256"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}