The ECB’s policy arsenal has not been depleted and fiscal policy could help stimulate investment, said the ECB incoming Executive Board member Philip Lane.

Investors fear the ECB’s window to potentially raise interest rates has closed, meaning it has little in its toolkit to face the next recession.

But Lane, Ireland's central bank governor, said the bank still had options. "The idea that the ECB lacks potency is very far from where we are," he told.

Lane added that fiscal policy could also help reduce policy uncertainty, and encourage the private sector to resume investing.