IAN’s Week in Review: Germany’s U-turn

In Europe, the German-French proposal of a 500bn fund issued by the Commission and distributed as grants, marks a U-turn for Germany, as its public opinion appears to be more favourable to supporting other EU countries. It also looks like a response to its Constitutional Court recent ruling, which was critical of the ECB asset purchase programme. By proposing a new fund, the German Government would take some pressure off the ECB’s hands to support the Euro area economy.

China, has announced a new law that will allow its security agencies to set-up directly in Hong Kong, spooking investors and attracting international criticism. There are precious few details but that would be a severe curtailment to the policy of “one country, two systems” which is due to last until 2047.

In the US, a Pew Research poll show that support for the President’s handling of the crisis has fallen across most religious groups, including evangelicals, that were significant supporters in his election.

International Press Review

China flexes its trade muscles, by Charles Dunst: Beijing’s pressure on Australia is a warning for European exporters.

Making Economies More Resilient to Downturns, by the IMF: Our analysis shows that adopting rules-based fiscal stimulus measures can be highly effective and more timely, particularly when central bank interest rates are close to or at their effective lower bound and monetary policy is constrained.

Countries should seize the moment to flatten the climate curve, by the Economist: The pandemic shows how hard it will be to decarbonise—and creates an opportunity

Which Post-Pandemic Government? by Raghuram G. Rajan: Although the COVID-19 pandemic has shown why high-level coordination is sometimes necessary for managing emergencies, it has also underscored the risks of placing too much power in the hands of an incompetent central authority. The best approach is a middle path, with a slight bias in favor of decentralization.

The rise and fall of global trade from the Romans to coronavirus, by the FT (video)