The asymmetric policy reactions of the United States and the euro zone to the economic slowdown

The US and euro-zone economies are slowing or will slow down in 2020. The two countries’ economic policy reaction s are going to be very different: In the United States, it is very unlikely that fiscal policy will be able to become more expansionary, given the Democratic majority in the House of Representatives . T h is suggests the reaction to the economic slowdown will consist primarily in a more expansionary monetary policy (interest rate cuts); In the euro zone, monetary policy hardly has any leeway to become more expansionary , which suggests the reaction to the economic slowdown will consist primarily in a more expansionary fiscal policy.