Europe's economic recovery is uncertain and risks "running out of steam" amid a second wave of COVID-19 infections, the head of the European Central Bank (ECB) said in an interview.
ECB President Christine Lagarde said in an interview with French newspaper Le Monde that the most serious effects of the pandemic will be job losses even though, she explained, the EU had saved an estimated one million jobs in the eurozone.
"The second wave of the epidemic in Europe, particularly in France, and the new restrictive measures that accompany it add to uncertainty and weigh on the recovery," she said.
The ECB predicts that GDP in the eurozone will fall by 8% in 2020 amid the pandemic, even assuming there are local lockdowns.
"If the situation deteriorates, this will obviously darken our forecasts, which we will revise in December," Lagarde told Le Monde. She emphasised later in the interview that the speed and scale of the economic shock due to COVID-19 was "unprecedented".
EU leaders reached a landmark €1.82 trillion budget and COVID-19 recovery package in July.
It comes after bitter discussions over the seven-year budget and recovery package which includes jointly borrowing a €750 billion recovery fund to be shared as grants and loans.
"It is crucial that this exceptional plan, which has lifted significant taboos in some countries, is a success," Lagarde told Le Monde, explaining that it must not be applied until after 2021.
She said the stimulus plan should stay as a possible tool in their box of solutions, emphasising the importance of collective solutions.