This framework is a well thought out decision taken in consultation with stakeholders and is aimed at striking a balance between protecting the interest of depositors and maintaining financial stability on one hand, and preserving the economic value of viable businesses by providing durable relief to businesses as well as individuals affected by the Covid-19 pandemic, on the other.
Fiscal policies should support the modest economic recovery and ensure debt sustainability, while remaining in full compliance with the EU’s fiscal rules. With bond yields subject to volatility, high-debt countries in particular need to pay attention to risks related to a reversal of the current low interest rate environment.