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As part of a turbulent global market, Europeans have revived their worst nightmares from the hand of a rebellious Italy. The European Commission's rejection of the Italian budget has hit the markets of the Old Continent, fearing that the performance of Italian sovereign debt will continue to rise to unsustainable levels, fueling the options of an "italeave" as part of a government with a eurosceptic connotation.
Yesterday, the Italian bond reached 3.58%, thus increasing its differential against the German bond and by far watching the performance of pairs like the Spanish (1.66%) or the British (1 ). , 48%).
And although the decline in the Milan Stock Exchange was limited to 1%, European volatility rose 10%, a time when the Frankfurt stock market lost 2.17%, reaching its highest level. low level. since December 2014. Thus, investors have clearly indicated that the disorder in which lies Italy is a concern for the whole block.
Although the Commission's rejection is long overdue (see details in the list), what makes the investor want is the lack of a plan to align the interests of both parties and to reach a good port.
"This is an unprecedented situation, and the decision should not surprise anyone because the Italian government's draft budget represents a clear and intentional departure from the commitments made by Italy last July", said yesterday the European Commissioner for Economic Affairs, Pierre Moscovici, during the oral argument of rejection.
No meeting point
But even before To formalize the refusal, the Prime Minister, Giuseppe Conte, warned: "there is no plan B on the budget". For his part, President Sergio Mattarella drew the attention of his country's political clbad, saying that it was "the duty of the entire government to keep the accounts in order".
However, before the zero answer, it seems that the pro-European votes are not the ones that weigh the most in the debate. "They are not attacking a government, but a people."
These are things that make Italians even more angry and there are those who regret that the EU is at least of its own. popularity, "said Matteo Salvani, vice president of the ultra party. Liga Norte, right
Luigi Di Maio, the Salvani couple and member of the Five Star Movement, presented a similar vision. "This is the first Italian budget that the EU does not like.This is not surprising: it is the first Italian budget drafted in Rome and not in Brussels!" , Did he declare.
Balance of risks
In this scenario, the risks are of great mark. The debt crisis that has rocked the euro area is still in the memories, while the Italian bond continues to worsen.
In this regard, Nicolas Veron, principal investigator at Bruegel and Peterson Institute, explains to PULSO that the discrepancies have led to "higher financing costs for the government itself and for the economy in general" and that "given the fragility of the balance sheets of Italian banks, the risk of a credit crunch is also present if this situation continues"
the eurosceptic badault is closely monitored by other representatives of the sector in Europe, where they come back dreaming of a "put on hold".
Nigel Farage, one of the leaders of the movement that led to Brexit, badures that Italy is "the last nightmare". From the European Community
"Here you have a democratically elected government, which is trying to push forward a perfectly responsible budget, which is rejected by an unelected bureaucracy.
Italy and the European Union are clashing, "he said in an interview with Fox News, pointing out that his bet was that" Italy would fail " with the euro.
Jorge Cariola, Deputy Head of Global Strategy at Inversiones Security, does not consider the "scenario" to be the most plausible scenario, but warns that such an approach would be even worse that a "grexit".
It explains as well as a "difference" An important point between Greece and Italy is that in the first case, the interconnection with the rest of Europe was limited and that their eventual exit from the common space represented a very bad signal, but not the beginning of the end.
The situation in Italy is different, because of its importance macroeconomic and the debt market. "
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