FRANKFURT (Reuters) – A pan-European response is needed to help euro zone members hit hardest in a coronavirus crisis that is likely to last and end only gradually, European Central Bank policymaker Klaas Knot said on Tuesday.
“A pan-European policy response is needed to help the hardest-hit countries. Recent policy announcements offer a step in the right direction, but this crisis is clearly not one that will be solved overnight,” Knot told an online webinar organised by Danske Bank.
European leaders are inching closer to a joint effort but richer northern countries like Germany and the Netherlands have been holding out on mutualising debt.
Knot noted that debt sustainability can be maintained in the euro zone only if interest rates remain low.
(Reporting by Balazs Koranyi; Editing by Francesco Canepa)