MNI BRIEF: EU Covid Funds May Not Be Enough - ECB's Schnabel

The economic impact of the Covid-19 pandemic will be felt "well beyond" the duration of the health crisis, ECB Executive Board member Isabel Schnabel said in an interview published Wednesday, adding that existing EU fiscal support measures "may turn out to be insufficient."

Rapid interest rates rises -- rather than specific levels -- prompted the ECB to announce a significant increase in purchase under its PEPP programme last week, as predicted by MNI, Schnabel said, with PEPP set to continue until the Governing Council judges the pandemic crisis phase to be over, "and when we have managed to counter the shock to the inflation path."

"But let me emphasise that the economic effects of the crisis will likely be more persistent," she added. "Our other instruments will remain available to ensure that inflation converges back to our medium-term aim."