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The badurances of the Italian Government that it will make every effort to contain the debt, did not convince the European Commission. More than expected, the Commission rejected the Italian draft budget, urging Rome to resubmit an improved proposal within three weeks, according to the Italian agency AGI.
Earlier, Luigi Di Maio, leader of the Five Star Movement and Italian Deputy Prime Minister, said that Rome knew very well that the rejection of its budget was imminent and that it had not to wait for the formal decision of the European Commission. However, he expressed the hope that the dialogue between the two sides would continue.
On the same wavelength, the Deputy Prime Minister and Italian Interior Minister, Mateo Salvini, stressed that the government would hear all parties but would not withdraw.
"Plan B" of the 2019 budget was rejected by Italian Prime Minister Giuseppe Conte in an interview with Bloomberg. "There is no question related to Plan B in the budget," he said, in anticipation of the Commission's response. At the same time, he stressed that budget interventions are not acceptable.
It is recalled that the Commissioner for Economic Affairs, Pierre Moscovici, has repeated on several occasions in recent days that he did not want things with Italy go too far and that he asks for conciliation .
It should be noted however that it is the first time in its history that the Commission rejects the budget of an EU Member State.
However, contrary to the Italian government's support for the 2019 budget and the controversy with Brussels, there is a plan B, according to the Italian newspaper Il Messaggero, which would have, among other things, ready to adjust the measures budgeted if the markets react negatively to its plans. and spread out.
This is an alternative plan, which includes a redefinition of basic pension and income measures, which could be postponed or even canceled. It also means finding a compromise with the Commission.
Finally, the Italian government also hopes to intervene within the ECB if necessary. According to La Stampa, Rome hopes that the European Central Bank will be able to buy Italian badets if necessary.
Immediately after the announcement of the Italian press, Italian bond yields fell after the jump made at the start of today 's meeting. The spread of the 10-year Italian bond on the German equivalent fell 10 basis points from the peak of the day to 303.7 basis points and Italian counterparts (reversed by their yields) reversed the price. initial. losses.
Yields in billions of dollars fell by six basis points to 1,399%, to 10 basis points previously, while the yield on five-year bonds fell by four basis points to 2.75%.
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