spain CDSs

COVID-19 And Country Risk In The Euro Area: This Time Is Different For Spain!

Caixabank (Eduard LLorens and Alex Ruiz )  | Intuition tells us that a shock like COVID-19 should increase country risk and this has certainly been confirmed by the data. Nevertheless, a longer-lasting impact on country risk should be observed, which is not the case. The investor narrative would be that in the states hardest hit by the COVID-19 pandemic, NGEU and the ECB have had a greater mitigating effect: as much as four credit rating levels in the cases of Spain and France, and three in the case of Portugal.