Ten years ago, European leaders judged that the economic recovery from global financial crisis was secured, and shifted from stimulus to fiscal and monetary tightening. The result was a second downturn and, in the eurozone, a near-existential sovereign debt crisis.

We should keep this vivid memory in mind today so as not to become complacent as the Covid-19 pandemic recovery picks up. The risks are great that this could become another false dawn. Whether it does, depends on how policymakers act in the months ahead. It is natural to hope for the best, but they must also prepare for the worst.

The pandemic and the lockdowns it triggered cast the European economy into its steepest recession on record. The eurozone lost one-sixth of its output in the first half of the year; in Spain, the fall was 22 per cent. Germany did better, with a first-half contraction of “only” 12 per cent.