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Moments after Morneau’s press conference, U.S. President Donald Trump declared a national emergency freeing up US$50 billion in federal resources to combat the coronavirus as the number of American cases quickly climbed.

Morneau’s announcement comes on top of a $1-billion injection, announced earlier this week, for COVID-19 health research, enhanced unemployment insurance measures and funding for the provinces to address the crisis. But with a recession looming large, much more will be needed economists say.

Indeed, Canada and the U.S. are likely to join a growing list of countries facing an economic contraction with output dropping in both the second and third quarters, CIBC World Markets said in a report Friday.

“This was a very, very powerful move today and it was about time,” said Benjamin Tal, deputy chief economist at CIBC World Markets. “But this was just the warm up. We need to see what they do next week.”

Economists had cautioned that the monetary stimulus offered by the Bank of Canada through rate cuts would be insufficient to offset the impacts of the virus. While lower interest rates can ease lending, they can do little to address supply chain disruptions or collapsed demand from nervous consumers. To keep the economy moving, Ottawa will need to apply quick, decisive measures to assist Canadians.

“The bottom line is you want to send money directly into the pockets of individuals and small businesses,” said Tal.

With one of the lowest debt to GDP ratios in the G7 group of nations, Canada is in a strong position to do just that, said Craig Alexander, chief economist for Deloitte Canada.

“The argument for keeping the powder dry is that you have it when the economy needs it,” Alexander said. “Now is the time we need it. We have the capacity for large scale fiscal stimulus and we should use it.”