William Malcolm

ECB’s De Guindos Says Coronavirus Will Put Europe Into Recession

The adverse economic effects of coronavirus will push the European economy into a recession. But, the gross domestic product should rebound in the second half of the year.

“I think the first half of the year will be very bad. Europe will enter a recession,” de Guindos said. “But I believe we will see growth in the second half of the year,” he added. He also said that the ECB would do everything necessary to combat the economic impact of coronavirus and pointed out the need to prevent a debt crisis in Europe.

Recession is defined as two-quarters of a downturn in the economy.

The ECB has already announced several stimulus measures in response to the coronavirus crisis, including large-scale bond purchases and offering extremely cheap loans to commercial banks. It is trying to keep the costs of loans to businesses and governments low, Reuters said.

Ignazio Visco, a member of the Governing Council of the ECB, said today that the central bank’s actions so far are sufficient. However, he added that, if necessary, the ECB is ready to take further action, including expanding bond purchases.

The European Commission predicted last week that the European Union economy is likely to fall by around a percentage due to coronavirus this year. Last month, however, expected growth of 1.4 percent. The growth of the EU economy slowed down to 1.5 from 2.1 percent last year.