ECB’s de Cos: Light at End of Tunnel, But Tunnel May Lengthen and Light May Dim

15 April 2021

By David Barwick – FRANKFURT (Econostream) – Although there is light at the end of the tunnel through the crisis, the tunnel could yet get longer, European Central Bank Governing Council member Pablo Hernández de Cos said Thursday.

In a speech at the Eurofi High-level Virtual Seminar 2021 posted to the website of Banco de España, which he heads, de Cos said that ‘recent positive health-related developments bring some much-needed rays of hope’, citing vaccines, diagnostics and treatments.

‘There is light at the end of the tunnel’, he said. ‘But there continues to be a high degree of uncertainty related to the outlook, and with it a range of downside risks’ such as mutations and snags in the rollout of vaccines.

‘Health-related restrictions may continue to be with us for some time, which in turn will continue to impact economic activity’, he said. ‘Talk of sharp economic bouncebacks and a revival of the Roaring Twenties may therefore prove to be somewhat premature. Put differently, the tunnel may well lengthen, with the light at its end becoming dimmer.’