ECB’s de Guindos: Most Worried About Two-Speed Economic Recovery

1 July 2020

By David Barwick – FRANKFURT (EconoStream) – The economic recovery is proceeding at different speeds throughout the euro area, European Central Bank Vice President Luis de Guindos said Wednesday.

In an interview with Italian daily La Stampa, de Guindos, according to a text provided by the ECB, reiterated the ECB’s steadfast commitment to the common currency.

That a recovery is underway and that there remain many uncertainties about its evolution is normal, he said. ‘But the most worrying thing is that a two-speed recovery seems to be starting to emerge’, he said.

While the economic contraction was more pronounced in some countries, there are also some ‘more resilient economies that reacted better than others’, he said. ‘For this group, GDP will therefore increase at a faster pace. This could lead to two-speed growth in Europe. We must keep a close eye on this.’

Asked whether the ECB remained willing to do ‘whatever it takes’, de Guindos replied that ‘[o]ur commitment is unwavering. As is clear from our communication, we stand ready to recalibrate our non-standard measures and pandemic programmes – such as the pandemic emergency purchase programme (PEPP) – so that they can be adapted to suit the circumstances.’

Accusations that the ECB acts in particular favor of Italy are untroubling, he made clear. ‘I have no objections to being described as “pro-Italy” because it would mean being “pro-Europe”’, he said. ‘I am pro-Italy, or pro-France, or pro-Spain, I am also pro-Germany. We are all in the same boat.’