Some countries nearing recession: ECB's De Cos

Wednesday, 18. September 2019 14:31

Another member of the Governing Council of the European Central Bank openly backed outgoing President Mario Draghi, who has strongly urged governments in the Eurozone with fiscal leeway to boost spending in order for the economy to overcome the current challenges. A week after policymakers cut the benchmark deposit rate and unveiled open-ended stimulus, Pablo Hernandez de Cos (pictured), the governor of the Bank of Spain, said on Wednesday that the measures are complementary but that weakness may continue after the third quarter. Speaking in Valencia, he warned of the possibility of "imminent recession" in several Eurozone countries.

Monetary support remains effective but it can't be successful alone, he stressed and pointed to the responsibility of member states which have "scope for it" to prop up investments and expenditures. The latest ECB package will help the euro area "in a context of high uncertainty" and the return of inflation higher to the target of just below 2%, according to De Cos, who also said the global slowdown in services could lead to a wide downturn.

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