18 July | Euro

EU proposes joint borrowing to finance crisis instrument

EU proposes joint borrowing to finance crisis instrument

The European Commission has proposed creating an anti-crisis tool with a budget of 400 billion euros ($464.76 billion), financed through joint borrowing. This new budgetary instrument, which will be in effect from 2028 to 2034, will provide loans to countries to help them respond more quickly to adverse events, such as the pandemic or an energy crisis. However, it is controversial among EU member states because it pools liabilities to subsidize less financially efficient states.

Germany has particularly criticized the EU's $2 trillion budget for 2028–2034. As the Commission noted, some countries will find it difficult to accept the new mechanism. It was also announced that the fund will distribute money in the form of loans rather than grants. Financing will be provided through joint borrowing, but with strict mandatory control and the approval of all 27 EU member states.

The yield on the region's 10-year debt obligations rose to 3.17%, though it remains below the peak reached in early March. The proposed budget will undergo a complex approval process involving the European Parliament and the EU Council.

Period: 05.09.2025 Expectation: 900 pips
AUDCAD loses momentum near channel resistance
29 August 2025 40
Period: 05.09.2025 Expectation: 900 pips
Inverse head and shoulders pattern to form upon GBPUSD break of 1.358
29 August 2025 50
Period: 30.11.2025 Expectation: 2800 pips
USDJPY set to weaken in medium term
29 August 2025 28
Brent sell
Period: 05.09.2025 Expectation: 200 pips
Brent declines amid growing inventories and potential production increases
29 August 2025 51
Period: 05.09.2025 Expectation: 600 pips
Buying USDCAD on divergent data from US and Canada
29 August 2025 25
Period: 30.11.2025 Expectation: 3000 pips
Tesla shares to get boost on breaking $370
28 August 2025 49
Go to forecasts