If China cannot go back to work, firms will need support: Helene Rey

Helene Rey says if the hit is big enough, it can have a macro effect on demand

Businesses affected by the coronavirus outbreak must be saved till the threat gets over, says Helene Rey, who teaches at London Business School. Rey, who is in Mumbai to deliver Exim Bank’s commencement day annual lecture, told Anup Roy that India needs to undertake structural reforms before it can hope for proper monetary policy transmission. Edited excerpts:

How do you see the coronavirus outbreak impacting the world economy?

First, we thought the virus could probably be contained, and except for human lives in China, the consequences for the global economy would be not very serious. But now, it looks like