A €750 billion emergency package has been launched by The European Central Bank in order to help reduce the impact of the coronavirus pandemic. The aim of the emergency package is to purchase company and government debt around the eurozone, including countries that have been devasted by Covid-19.
The scheme is only a temporary asset purchasing measure and will be closed once the ECB, “judges that the coronavirus Covid-19 crisis is over, but in any case, not before the end of the year,” it said.
This package comes in conjunction as countries in the G7 have announced major stimulus plans to help their struggling economy’s.
The ECB announcement comes six days after the organization failed to help global markets.
The President of the ECB, Christine Lagarde last night (Mar 18, 2020) announced on Twitter, “Extraordinary times require extraordinary action. There are no limits to our commitment to the euro. We are determined to use the full potential of our tools, within our mandate.”
The emergency package comes following a 25-member council meeting via phone on Wednesday evening.
The ECB had been urged to take bolder and decisive action in the last couple of days to support the eurozone as the US Federal Reserve ramped up its support for the Dollar. Cutting interest rates to almost zero and launching a $700 billion stimulus package in conjunction with the UK, Japan, Eurozone, Canada, and Switzerland.
In a statement, the Fed said it would work with other global central banks to increase the availability of dollars for commercial banks.
This financial tool of currency swap lines was recently used in the 2008 banking crisis.
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