Economics

Euro-Area Economy Closer to ECB’s Worst-Case Estimates, Lagarde Says

President Lagarde speaks in online Q&A session for youth
Economic contraction in 2020 to be in range of 8% to 12%

ECB’s Lagarde Sees Economy Closer to Worst-Case Estimates

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By Carolynn Look

May 27, 2020 at 8:07 AM UTC

Updated on

May 27, 2020 at 1:37 PM UTC

This article is for subscribers only.

The euro-area economy is faring worse than hoped, facing a recession as bad as the European Central Bank’s more pessimistic forecasts.

Output is set to shrink between 8% and 12%, ECB President Christine Lagarde and Vice President Luis De Guindos both said on Wednesday, calling a milder scenario out of date. The remarks highlight the severity of the repercussions for Europe after businesses were forced to close because of the coronavirus pandemic, costing hundreds of thousands of jobs and furloughing millions more.