European Commission proposal offers hope of grants

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By Lewis McLellan
27 May 2020

The European Commission has published its proposal for an EU recovery fund. Next Generation EU, as it has been dubbed, has impressed onlookers with promises of €500bn of grants and a further €250bn of loans for countries affected by the coronavirus pandemic.

The news has come as a great relief to investors in the eurozone periphery. Italy’s spread over Bunds fell around 10bp at 10 years on Wednesday.

The proposal forms part of the EU’s budget, known as the Multi-Annual Financial Framework, which must be agreed by the European Council ...

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