The worst of the economic crisis caused by the coronavirus pandemic is likely to have endured, Kristine Lagarda, the governor of the European Central Bank (ECB), said on Friday.
“We have probably overcome the low point. I say this with some caution, because of course there is probably a second wave if we have learned something from the Spanish flu,” Lagarda said at an online conference.
However, she warned that the new normal situation would be different from the previous one.
The sectors hardest hit, including aviation, hospitality and entertainment, will emerge from the crisis in a “different form” and new sectors may emerge, Lagarda said.
The economic recovery will also be experienced at different speeds. she said.
Looking at the regions, the sharpest decline will be in the eurozone, whose economy could shrink by 10.2% this year. In China, on the other hand, growth of 1% is expected this year, the head of the ECB explained.
This time, too, a situation has been observed in which both central banks and governments have jointly participated in overcoming the crisis. “This time it is a very special case that monetary and fiscal policies have worked hand in hand,” Lagarda stressed.
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