European Central Bank(ECB) noted that the Eurozone will be facing aggravating recession; signs of a rebound may show up in the third quarter, but the economy won’t recover completely until 2021.
ECB expected to see a V-shape or U-shape recovery of the Eurozone, while emphasizing that the recovery pattern will be subject to how long the pandemic will lock down economy. But whichever way the recovery turns out in 2021, it won’t be able to cover losses caused by this year’s recession. To keep the Eurozone from falling apart, ECB’s bond purchase scheme, mainly consists of national bonds, will amount to €1.1 trillion in 2020.
The severe recession across the Eurozone will further affect public finance, which is estimated to need around €1-1.5 trillion. Chancellors of EU member countries recently agreed on launching a €540 billion massive aid program, which includes measures that aim to help Europe tackle the unprecedented crisis.
EUR/USD daily pivot point: 1.0935
S1: 1.0919 R1: 1.0951
S2: 1.0902 R2: 1.0967
