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At last week's ECB meeting Christine Lagarde announced that the central bank has started out on a "journey" toward the normalization of monetary policy through a series of measures that it will take gradually over the next few months.

Public debt levels have skyrocketed globally due to the increase in fiscal expenditure needed for public measures to fight the economic damage caused by the pandemic, and by the effects of the slump in economic activity.

Spanish public finances are not in the best position to face this crisis. Since 2015, policies to reduce taxes and increase expenditure have impaired the fiscal structural balance.

The rapid outbreak of the new coronavirus (COVID-19), which has spread far beyond China, has wreaked havoc on financial markets. World stock markets have fallen by around 30% in just over a month, led by the transport, tourism, hotel industry a…

In recent months we have witnessed a notable compression in sovereign CDS at the global level, in an economic scenario that is full of uncertainty and in which public debt is at an all-time high.

A couple of years ago, the risk premium paid by the Portuguese 10-year government bond against its German counterpart was hovering between 350 and 400 basis points (bp). Meanwhile, the Spanish 10-year bond was paying between 100 and 125 bp.