More fiscal and monetary stimulus to come

We doubt that EU leaders reach a final deal on the proposed Recovery Fund at the conference which its taking place today and tomorrow in Brussels, though a deal is likely eventually. In any case, most of the fiscal cost of the crisis will continue to be borne by national governments, with France and Italy preparing this week to increase their stimulus packages. Meanwhile, the ECB has dampened any expectations that it may not use all the funds allocated to its emergency asset purchase programme.