Europe Weighs Using Bailout Fund Bazooka in Virus Crisis

European Stability Mechanism has $458 billion unused firepower
EU liquidity guarantees to companies have reached 10% of GDP

Klaus Regling
Photographer: Dario Pignatelli/Bloomberg

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By Nikos Chrysoloras and Viktoria Dendrinou

March 16, 2020 at 8:52 PM UTC

Updated on

March 17, 2020 at 8:29 AM UTC

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The euro area’s gigantic bailout fund is exploring how it can use its reserves to cushion the impact of a virus-induced recession, in a move that could help reassure markets after a spike in borrowing costs for the region’s most vulnerable economies.

Klaus Regling, the head of the European Stability Mechanism, said Monday it has an unused lending capacity of 410 billion euros ($458 billion).