We are on the cusp of another economic policy error in the eurozone. Its roots lie in a mixture of complacency about coronavirus and a deep-seated belief that monetary policy has no ammunition left when interest rates are negative and that fiscal policy is, by nature, constrained.

It is comical, yet consistent with the observation above, to hear European policymakers reiterating that they are waiting and monitoring the situation. Eurozone finance ministers could not agree on a co-ordinated policy response when they held a telephone conference last week. And the G7 industrialised nations only managed to agree — guess what — to monitor the situation. Even Christine Lagarde, president of the European Central Bank, felt the need to issue a statement saying that she, too, was “closely monitoring developments”.

There is still a lot we do not know about Covid-19. But we know what we need to know for an economic policy response. The UK government’s medical advisers, for example, have calculated that, with existing measures, the greatest increase in the number of cases will occur in April, with a peak in May or June. This implies economic disruption lasting at least into the summer.