If a watched pot never boils, does a watched EC never come to an agreement? After a weekend of long drawn-out discussion, we are beginning to hear positive murmurs around the Covid-19 relief fund emanating from the continent, though no tangible agreement as of yet. It seems that the ‘Frugal Four’ are softening their stance around how the relief package is funded, with an apparent agreement of €390m in grants, and the remainder facilitated by low-interest loans. As mentioned, the deal is not over the line yet, but there is a chance we get further clarity after they resume talks from 4pm today. We see peripheral banks as one of the main beneficiaries of an agreement, as well as risk assets more generally. The Euro climbed to an 18-month high against the dollar earlier as well, however has since faded slightly.
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