From the Washington Post:

Germany and France have drafted a joint proposal to give countries using the euro more flexibility in running up budget deficits, German Chancellor Gerhard Schroeder said Monday...

"We want to make the whole thing a bit more flexible," Chirac said, adding that the pact had been "interpreted too strictly" in the past.

Germany and France have broken the deficit limits of the so-called Stability Pact in each of the last three years.

Not that this was a big surprise, but apparently some details are forthcoming -- just not quite yet.

Neither leader gave details.

Stay tuned.