Implications for policies With the right policy response, we can mitigate the economic consequences of the war and manage the high levels of uncertainty we are facing. To offset the short-term effects of higher energy prices and sanctions, national fiscal policies have a range of tools to deploy, such as tax cuts and subsidies.
And rules at the EU level are being loosened so that governments can take the necessary measures to protect their people. The additional fiscal measures announced in the euro area4 since the invasion amount to 0.4% of euro area GDP this year.