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ECB Says EU Fund Could Boost Economy by Either 1.5% or Almost Nothing

Euro area governments could boost the region’s economy by as much as 1.5% -- or next to nothing -- depending on how they spend a groundbreaking stimulus package, according to European Central Bank research.

The European Union 750 billion-euro ($908 billion) recovery fund will deliver its greatest impact by being used on “productive public investment,” which would boost wages and private investors’ returns, the ECB said in a paper on Thursday. The effects would peak in 2025 and linger “beyond the horizon” of the EU project, it said.