Fiscal stimulus is calculated as the change in the primary deficit, adjusted for cyclical effects. Since the crisis hit Europe, concerns about increasing fragmentation in the euro area have also dominated financial market developments. In March, monetary policy was faced with a rapidly deteriorating market environment. Investors fled to the safest securities and asset classes.
Risk premia in other market segments rose dramatically, liquidity dried up, and financing conditions worsened considerably. Companies were confronted with acute liquidity shortages as revenues plummeted abruptly.