Europe ‘Could Do Anything’ to Help Economy, ECB’s Panetta Says

European authorities could “do anything” to help boost the economy, Fabio Panetta, a member of the European Central Bank’s executive board, said at an online forum Saturday. “What we’ll do I don’t know, and if I did know I wouldn’t say,” Panetta said at the event organized by newspaper Il Foglio.

European Central Bank President Christine Lagarde said Thursday there’s “little doubt” policy makers will agree to provide more stimulus to the economy in December as coronavirus infections and lockdowns accelerate across Europe. The ECB’s next moves will at least partly be guided by the pandemic, Panetta said Saturday, adding that the next decisions could be made in the coming weeks. European fiscal and monetary policy has been well-coordinated during the crisis, he said.

Lagarde said the central bank will provide all the support needed. She also talked about the “recalibration” of the ECB’s measures which most economists say indicates that its 1.35 trillion-euro ($1.6 trillion) pandemic emergency purchase program will be expanded. The bond-buying plan agreed to in March is meant to buy up the debt of struggling nations to avoid stressing the finances of weaker countries.

New coronavirus lockdowns announced by France and Germany and partial lockdowns in other countries like Italy have darkened the euro area’s economic outlook. This may force governments to provide more stimulus and pressure the central bank to keep borrowing costs low.

The euro-area economy surged by a record in the third quarter, growing 12.7% in a rebound that may be derailed by a return to restrictions in the area’s main economies.

©2020 Bloomberg L.P.

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