Given that economic activity is still below pre-virus levels and the resurgence in virus cases shows little sign of abating, it is hardly surprising that Germany and France announced extensions to their furlough schemes this week. Spain’s government may well follow suit next week, but it is Germany that stands out at the most generous. Meanwhile, the US Fed’s change to its monetary policy framework surely strengthens the calls by the ECB’s doves that the Bank should be relaxed about inflation temporarily overshooting in the future.
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