The euro zone is too complacent about the coronavirus threat
Wolfgang Münchau: Monetary policy is still the only game in town
ECB president Christine has talked a lot about green finance and tackling climate change.
We are on the cusp of another economic policy error in the euro zone. Its roots lie in a mixture of complacency about coronavirus and a deep-seated belief that monetary policy has no ammunition left when interest rates are negative and that fiscal policy is, by nature, constrained.
It is comical, yet consistent with the observation above, to hear European policymakers reiterating that they are waiting and monitoring the situation. Euro zone finance ministers could not agree on a co-ordinated policy response when they held a telephone conference last week. And the G7 industrialised nations only managed to agree – guess what – to monitor the situation.