FRANKFURT (Reuters) – European Central Bank chief economist Philip Lane signalled a pause in policy action, arguing that a rebound is underway, markets have stabilized but that many months will be needed before there is clarity over the shape of the recovery. FILE PHOTO: Executive Board member of the European Central Bank Philip Lane attends the Fortune Global Forum in Paris, France, November 18, 2019. REUTERS/Gonzalo Fuentes Facing the biggest European recession in living memory due to the coronavirus pandemic, the ECB has already increased stimulus three times this year, providing unprecedented support for an economy that could shrink by close to a tenth in 2020 and take another two years just to get back to its pre-crisis level. The ECB extended its emergency bond purchases until June 2021 and Lane said that while markets are already pricing in a further expansion of the scheme, the bank had given itself up to a year to reassess the situation. “We’ve done a lot. We have essentially this one-year horizon,” Lane, a Dublin-born former university processor, told Reuters in an interview this week. “That one-year horizon reflects that, before we really know how able the European economy will be to recover from… Read full this story
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