The COVID-19 crisis has led to something of a paradox: Italy’s public debt ratio has risen, but the probability of default has fallen. That’s largely because BTP yields are likely to stay far lower than seemed plausible before the pandemic, meaning that interest costs will fall. As a result, we now think Italy’s debt ratio is likely to decline over the next decade.
Subscriber content
Read this in full, free
Start a free trial and use one of your 10 free starter credits to unlock this piece.