Lagarde projects EU GDP may fall by up to 15% due to COVID-19

Christine Lagarde, president of the European Central Bank, has announced new stimulus package measures to help take control of COVID-19 as it spreads across the eurozone. /AFP

The European Central Bank President Christine Lagarde has reportedly projected that the euro-area economy could shrink by as much as 15% as a result of the COVID-19 pandemic, and that they risk doing too little too late.

Lagarde is said to have made the remarks in a video meeting with the European Union's 27 heads of government, who are discussing how to mitigate the economic fallout of the disease.

Bloomberg reports an anonymous official with information about the meeting to say the 15% figure was the extreme scenario, with the ECB president saying her baseline estimate is a 9% cut in output this year.

German Chancellor Angela Merkel, who spoke to her counterparts after Lagarde, vowed to back a huge stimulus package for Europe. European stocks, Italian bonds and the single currency all rose.

Europe has been hard hit by the pandemic, having registered more than 100,000 fatalities.

Strict lockdown measures imposed to curb further spread of the disease have left economies in the region struggling, with factories shut down and travel halted.

Globally, the COVID-19 deaths have exceeded 185,000, with infections going beyond 2.65 million.

Source(s): Bloomberg