(Repeats to story to add video link, no changes to text) * For other news from Reuters Global Investment Outlook Summit 2021, click: here * To watch a video of the interview, click: 1.reutersevents.com/LP=29251 FRANKFURT, Dec 2 (Reuters) - The European Central Bank will look at more than its two hallmark instruments to support an economy that faces permanent damage from a pandemic-induced recession, ECB chief economist Philip Lane told Reuters. With the bloc heading for a double-dip recession, the ECB has already promised help through emergency bond buys and liquidity facilities, but Lane said more instruments could be discussed when policymakers meet on Dec. 10. “I think it’s important not to infer that we are only looking at two programmes,” Lane told the Reuters Global Investment Outlook Summit, 2021. “There is a wide array of policies in respect of collateral, in respect of swaps and repos and so on.” He said the ECB’s 1.35 trillion euro ($1.63 trillion) Pandemic Emergency Purchase Programme (PEPP) and a bank liquidity facility known as Targeted Longer-Term Refinancing Operations (TLTRO) have been “very effective” and would form the backbone of any policy move. Economists say the ECB could also help banks by increasing the amount of their mandatory reserves exempt from its negative deposit rate but a further rate cut, while theoretically possible, is unlikely. While Lane did not rule out changes to a less flexible facility named the Asset Purchase Programme, he said the PEPP should be the main instrument as its flexibility is better suited to the pandemic context. “If we can keep financing conditions where they are these days, at a low level, that supports the economic recovery,” Lane said. Lane also downplayed the significance of four straight months of negative inflation readings, saying much of the dip will be reversed automatically when the economy revives. “Once the economy recovers, then the very low prices in those sectors, which have been the case this autumn, will reverse to some extent,” Lane said. SCARS An effective vaccine will reduce the biggest risks to the economy, but deploying it will take time and much of 2021 will be constrained by pandemic-related restrictions, Lane said. Raising inflation towards the ECB’s 2% target will be difficult and could only happen gradually, given the bloc’s structural problems, even if some of the drag on inflation is reversed and price growth gets back into the 1% range, he said. A still bigger problem may be overcoming lasting economic damage. “So many people have worked less this year, in terms of accumulation of their skills, their experience, the loss of their income, there’s a negative from that,” Lane said, adding companies lost revenue, balance sheets are weakened, cash reserves fell and investments will suffer. While the tourism industry could bounce back, the real estate business faces lasting change as people are unlikely to work in offices to the same degree as before. For the full transcript of Lane’s interview, click on Follow Reuters Summits on Twitter @Reuters_Summits ($1 = 0.8293 euros) (Editing by Barbara Lewis)