Lagarde speech: Franco-German EU recovery fund plan is welcome

Dhwani Mehta FXStreet

Responding to the French-German EU recovery fund proposal on Monday, European Central Bank (ECB) President Christine Lagarde welcomed the news in a joint interview with four European newspapers.

Key quotes

“The Franco-German proposals are ambitious, targeted and, of course, welcome.”

“They pave the way for the European Commission to borrow funds over the long term and, above all, they allow a substantial amount of direct support to be provided to the countries most affected by the crisis.”

After two months of impending talks, France and German, finally, proposed for a 500 billion-euro ($546 billion) coronavirus recovery fund to help cushion the economic blow from the virus impact.

Market reaction

On the announcement of the plan, EUR/USD jumped to two-week highs of 1.0927.

At the press time, the spot trades on the back foot just above the 1.09 handle, suffering from broad US dollar rebound amid rising US-China tensions.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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