European Central Bank President Christine Lagarde said the bank is ready to inject fresh monetary stimulus to support the eurozone’s stuttering economic recovery from the Covid-19 pandemic, including by cutting a key interest rate further below zero. She said output wouldn’t return to pre-Covid levels until the end of 2022, and the world’s central banks would need to continue to provide stimulus to support government spending. “We are prepared to use all the tools that will produce the most effective, efficient, and proportionate outcome,” Ms. Lagarde said. The ECB’s key interest rate currently stands at minus 0.5%. Other major central banks including the Federal Reserve and Bank of England have also avoided pushing interest rates below zero to combat the crisis.

Source: Wall Street Journal October 06, 2020 08:37 UTC