The EU recovery fund may transform European bond markets
The EU’s new recovery fund is a historic step to help the countries worst affected by Covid avoid a debt trap. If the EU’s short-term bills become a risk-free, interest-rate instrument, this temporary response to the deadly virus could become a permanent change to Europe’s capital markets
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Towards the end of September the EU will launch a large new borrowing programme in the international debt capital markets that may see it sell over €30 billion of new bonds in the last three months of 2020.