ECB Chief Economist Philip Lane admitted in an interview with Les Echos that current lockdowns will “lead to a drop in activity” in Europe. But the measures are “less harsh” than those in Spring. Now, “manufacturing has been kept open, construction is continuing, essential shops remain open, and there is not too much disruption to supply chains.” Hence, the impact is likely to be “less severe” this time. Still “the situation will not materially improve in the last weeks of 2020.”
Based on ECB’s projections, it’s assumed that coronavirus vaccine will be rolled out throughout 2021. Lane said “full recovery of GDP, back to where it was in 2019, will not happen before the autumn of 2022”. Also, “in spite of the vaccine, there will be some persistent damage and the European economy will not exit this crisis without being weakened over a long period of time.”
