Europe Economics Update Should we worry about a M5S-League alliance? The fundamental differences between Italy’s Five Star Movement and League suggest that even if they agree to form a government together, they will not implement either party’s more extreme and costly... 10th May 2018 · 1 min read
Global Markets Update How will the end of ECB QE affect bond yields? We think that after the ECB has ended its asset purchases, bond yields will generally rise only slowly. The biggest increases are likely to come in the periphery, with Italy most at risk of a sharp... 2nd May 2018 · 1 min read
Europe Economics Update Would a Five Star-League alliance really be that bad? The fundamental differences between Italy’s Five Star Movement and League suggest that even if the parties agreed to form a government, they would not agree to implement either party’s more extreme... 26th March 2018 · 1 min read
Europe Economics Update Is a parallel currency the answer to Italy’s problems? Introducing a parallel currency could help to stimulate Italy’s economy by providing a fiscal boost and leading to an improvement in competitiveness. That said, despite some of the eurosceptic parties... 14th March 2018 · 1 min read
Global Economics Update After Italy’s election, what happens next? The lengthy political uncertainty that seems likely to follow Italy’s election is unlikely on its own to do much economic damage. But we suspect that the prospect of looser fiscal policy, higher debt... 5th March 2018 · 1 min read
Europe Economics Focus TARGET2 imbalances highlight euro-zone’s continued problems The large imbalances in the euro-zone’s TARGET2 payments system indicate that all is still not quite right in the region. There are some good reasons to expect the imbalances to narrow again over the... 2nd March 2018 · 1 min read
Europe Data Response Italy GDP (Q4, Breakdown) The first breakdown of Italy’s GDP in Q4 showed that the slowdown in growth was driven by household spending. This is perhaps unsurprising given that real wages are falling, and might also explain the... 2nd March 2018 · 1 min read
Europe Economics Focus How big a threat is Italy’s election? Italy’s general election on Sunday 4th March seems likely to result in a government that pushes for a small fiscal stimulus, largely centred on tax cuts. But we doubt that this would provide much of a... 28th February 2018 · 1 min read
Europe Data Response Italian, Dutch & Portuguese GDP (Q4) Q4 GDP data showed that Italy’s economy performed fairly well last year but that it is still lagging behindthe rest of the euro-zone. Despite the recent strength of the surveys, we doubt that this... 14th February 2018 · 1 min read
Europe Economics Weekly Is Italy’s economy really booming? With three weeks to go before Italy’s election, the latest surveys suggest that the economy is performing very well. But the official data paint a less rosy picture. On balance, we think that GDP will... 9th February 2018 · 1 min read
Europe Economics Update Are bond markets too sanguine about Italy? Investors appear to be calm ahead of Italy’s forthcoming election, and we think that they are right not to panic. That said, the next government is likely to be more lax with fiscal policy, so we... 29th January 2018 · 1 min read
Europe Commercial Property Update A sweet spot for Italian retail rents The combination of strong consumer spending growth and rising tourism appears to have been behind the sharp rise in prime retail rents in Milan and Rome last year. With these conditions set to... 25th January 2018 · 1 min read
Europe Economics Update What to make of Italy’s centre-right policy programme Italy’s coalition of centre-right parties has proposed a raft of sweeping policies that would cause a blow-out in the budget deficit and possibly a significant shrinking of the workforce. But in... 23rd January 2018 · 1 min read
Europe Economics Weekly Would a “flat tax” give Italy’s economy a boost? Two of the leading contenders to form a government after Italy’s general election on 4th March advocate a radical overhaul of the country’s tax code. Their plans would result in a substantial... 12th January 2018 · 1 min read
Europe Economics Update Would Italian politicians really pull Italy out of the euro? Italy’s general election in March looks likely to produce a fragmented government with eurosceptic tendencies. We don’t think that it will pull Italy out of the euro-zone, but it may cause yields to... 8th January 2018 · 1 min read
Europe Data Response Italy GDP (Q3, Breakdown) In Q3, Italy’s economy grew more slowly than the euro-zone as a whole for the ninth straight quarter. Timelier activity surveys suggest that growth will pick up a little in the run-up to next year’s... 1st December 2017 · 1 min read
