Italy's Salvini wants tax breaks for Italians investing in debt

Remigio Civitarese
Ottobre 11, 2018

During a press conference, Deputy Premier and Interior Minister Matteo Salvini blamed speculators, referring to a "Soros-like manoeuvre" that has little to do with the real economy. The government is expected to submit a draft budgetary plan to the European Union commission by 15 October.

The deficit for next's year's budget is supposed to be at 2.4%, although the European officials have commented negatively on it, so it seems hard that it will go through the European Parliament when Italy presents it next weekend. However, he said the government would act if the spread between its benchmark 10-year bond yield and the equivalent German bund balloons.

There were signs that the sell-off may not be done yet.

Local stocks fell for a third day, with the FTSE-MIB Index of shares sliding as much as 2.5% to the lowest level since April 2017. And before then, there is always a chance that a further selling off by market participants will rather separately force a rethink.

Banks were the most hit again, with Banco BPM SpA declining 5.6% and trading in UniCredit SpA temporarily halted after falling 5%.

The euro plummeted 0.2 percent to $1.1465, approximately to a seven-week low of $1.146 extended during the former session.

The head of the Lega Nord claimed that European Union officials were the "enemies of Europe", during a controversial press conference with France's far-right politician Marine Le Pen.

Salvini echoed that view, saying the European Commission - the executive body of the EU - were "enemies of the happiness of Europeans, barricaded in their bunkers in Brussels".

"The politics of austerity of the last few years have increased Italian debt and impoverished Italy".

Just recently, the Italian government sent European markets in a frenzy as comments from Claudio Borghi, who heads economic policy for the ruling Lega party, said the country would be better off if it wasn't tied to a single currency, the euro, and operated on its own currency. "You still have some uncertain and outstanding issues with what the rating agencies will do, but for the moment I think that uncertainty is being balanced by the fact yields have repriced a pretty significant amount".

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