September 23, 2018

What Will Italy’s Next Government Do? A Leak Jolts Stocks

They had argued that their proposal to hold a referendum on whether to leave the eurozone was a thing of the past, even as the party’s founder, the comedian Beppe Grillo, floated the idea again this month.

But the leaked document, the authenticity of which has not been disputed, revealed that their anti-establishment and euroskeptic heart still pulsed.

The parties had already talked about other proposals in the draft, though their inclusion in the document seemed to solidify them. The text confirms that both parties want an “immediate withdrawal” of European Union sanctions against Russia, to which both parties have grown close.

“We confirm our membership of the North Atlantic alliance, with the U.S. as a privileged ally and an opening to Russia, which should not be viewed as a threat but an economic and commercial partner,” the document reads.

As part of the immediate fallout, the spread between Italy’s and Germany’s 10-year bond yields grew.

Mr. Salvini, speaking on Facebook live, relished the angst.

“You remember the spread?” Mr. Salvini said mockingly, calling it the obsession of the “great financial powers” toying with Italy’s future. He recalled that it was bankers with concerns about “the increasing spread, the sinking markets” who forced the collapse of Silvio Berlusconi’s government in 2011.

Then he took aim at the elites in Washington, Berlin and Brussels, saying that he would ignore their concerns about the potential new Italian government and put Italians first.

Article source: https://www.nytimes.com/2018/05/16/world/europe/italy-talks-leak-markets.html?partner=rss&emc=rss

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