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Mutualising the financing of economic recovery and strategic onshoring for the entire euro zone after the coronavirus crisis is obviously a good idea, in the opinion of Patrick Artus from Natixis.

Key quotes

“Mutualisation would make it possible to finance persistently large fiscal deficits without any risk of a debt crisis, and would send a positive political signal.”

“For such mutualisation to be accepted by all countries, very rigorous governance and project selection will be required.”

“The bond market’s capacity to absorb even euro-zone debt is not unlimited. Long-term interest rates were rising even in the core euro-zone countries prior to the announcement of the ECB’s interventions, due to expectations of large fiscal deficits.”