ECB Chief Economist Philip Lane said that even though debt levels surged due to fiscal spending across Europe to counter pandemic impacts, they would remain sustainable.
He pointed out, “in the context of very low interest rates, in the context of the macroeconomic environment, the assessment should be that this is something that is sustainable”.
“There is no reason to believe that this has some kind of intrinsic dynamic that will lead us to a return of the conditions of ten years ago,” Lane added. “The cost of making the payments on this debt in the years to come will be quite contained.”
