Tensions between Italy and the EU are likely to escalate next week. Indeed, the Government has until Tuesday to submit a re-drafted budget, and despite coming under pressure from European policymakers this week, it is unlikely to make enough changes to placate the European Commission. Whether or not the EU increases its oversight of Italy’s budget, or even eventually imposes fines, the big picture is that slow growth and a widening budget deficit next year are likely to push Italy’s bond yields up further.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services