Central Bank governor Gabriel Makhlouf will tell the Oireachtas Special Committee on Covid-19 on Tuesday that the Government must set out a “clear and credible” path to reverse a spike in the budget deficit and national debt resulting from the current crisis. “The rise in the government deficit and debt ratios is both warranted and necessary and is currently affordable. Mr Makhouf said Government supports should be focused on boosting economic activity and avoiding “scarring effects” such as long-term unemployment. The Government is on track to run a budget deficit of between €23 billion and €30 billion this year, according to Minister for Finance Paschal Donohoe. ‘Borrowing rates’“This and other policy actions increase the probability that borrowing rates for sovereigns in the [euro area] will remain low for the foreseeable future,” Mr O’Connor said in a prepared statement.

Source: The Irish Times July 07, 2020 03:56 UTC