fabio panetta : interview in corriere della sera interview with mr fabio panetta, member of the executive board of the european central bank, in corriere della sera, conducted by mr daniele manca on 14 march 2020 and published on 15 march 2020. * * * the question everyone would like to ask of someone following the situation up close, minute by minute, is : are europe and the euro strong? i am not in any doubt about the strength of the euro. during the financial crisis, we were able to overcome difficult situations, thanks to the efforts made by the people of europe. we succeeded by working together and by putting in place policies that were mutually reinforcing. it ’ s important that, at such a difficult time, national governments and european institutions implement common policies in a timely fashion. right now we ’ re working towards tomorrow ’ s eurogroup meeting – there needs to be a joint response to this crisis which, let ’ s not forget, is affecting every country in europe. and the ecb is working with europe to strengthen that response. the stock market fell sharply after the ecb president ’ s press conference on thursday. influential voices joined in with the criticism that followed, and even the italian president got involved. but is the ecb ready to help italy? the decisions we took this week demonstrated that we are ready and able to play our part. regardless of any isolated events that may occur in the heat of the moment, at a time of immense pressure and hard work, the ecb and the national central banks have decided to take strong action and apply all the flexibility needed at present, and we have resolved to adopt further measures if necessary. facts are what count right now, and we will do everything we have to, within our mandate. what concrete action can the ecb take to help italian firms and households? first of all, let me say that the economic consequences of the pandemic will need to be addressed first and foremost by governments. they are the ones that are able to implement swift and decisive measures to support healthcare systems, employment and household income. they are the ones who can take targeted action to help firms, providing public guarantees in order to channel credit and liquidity to companies affected by the crisis. so it ’ s a positive step that european governments are following the example of the italian government and are taking action. and what about the ecb? these actions will reinforce the effects of the measures put in place by the ec

good that policy responses are being activated. the sooner a plan to kick start the economy is ready, the better it will be. i also hope that the geopolitical tensions of recent months will weaken, so as to strengthen confidence. we cannot allow other shocks to occur, such as trade or currency wars. the other central banks have also taken action, but it has not sufficed to reassure the markets – a sign that monetary policy has become less effective or confirmation that central banks can do a great deal but they cannot do everything? some may hold the view that central banks are practically omnipotent. this is a false impression that could distort public debate, by attributing to central banks responsibilities and tasks that are beyond their remit. central bankers should be well - versed in their tools, but should also know their limits. monetary policy is a very powerful tool for influencing the financial markets, the process of creating credit to the economy, consumption and investment decisions, job creation and inflation. but it cannot influence the healthcare system, it cannot make people start going to restaurants and theatres again. there are a great many reasons for pessimism. can you give any reasons for italians to be optimistic? i can give them many reasons. in economic terms, we have a strong private sector with low household indebtedness, an internationally competitive manufacturing sector, a positive balance of payments and a balanced international investment position. we must not let the crisis weaken us. we have improved the situation of the banks, albeit not without effort. but the main reason for pride and optimism is the great unity and determination in response to the emergency of the virus shown by our country in a very difficult situation. i am thinking of the people working in the hospitals and institutions, but above all the italian citizens, who are calmly enduring severe hardships for the sake of safeguarding the public good. 3 / 3 bis central bankers'speeches