Towards a higher cost to finance the economy after the coronavirus crisis

We see several reasons why the economy ’s borrowing costs may be higher after the coronavirus crisis: The rise in risk aversion and therefore in risk premia (on equities, corporate bonds, loans); The increase in corporate debt and the decline in the average credit rating; Stricter stress tests for banks and an increase in their capital requirements. The rise in the economy ’s borrowing costs is obviously negative for the recovery in investment and growth.