The graph is an update of the previous analysis and follows the spread between Italian BTP 10Y and German BUND 10Y with a timeline of the Italian government's announcement and the European Commission responses
The Italian Government sent the aggressive budget proposal to Brussels, with Finance Minister Tria suggesting he can "explain" things to EU counterparties and receive acceptance. Market participants know it's a long shot, and BTPs should come under more pressure.
Italy's populist government kept some of it's promises and delivered a hefty budget for 2019 ata deficit of 2.4%.
Markets are pricing in more of a conflict between Italy and Brussels. THis move down has quite a ways to go.
Clash between EU and Italy becoming more evident as Italy Rating Outlook Cut by Fitch on Possible Fiscal Loosening but "Italians come before ratings agencies" deputy PM says - “We have to put the financing in the budget so that at least 5 million impoverished Italians can get back to work.”
hello guys here's a new idea on italy BTP. First of all, we saw recently that the market wants to speculate (again) on BTP, this means that interest rate until September will go down, then will rise due to rating agencies decision and what is called 'DEF', the document of economics and finance by the Government. In this document there'll be the outline of fiscal...
BTPs bounced the key resistance area and have closed below a recent flip zone on the back of fears that Italy will not comply with EU rules in forming it's next budget, that contains flat-tax proposals and a hefty pension reform.
Look for further losses today.
Italy's Deputy PM DiMaio confirms markets' fears: this morning he said
that respecting fiscal rules is not the priority in the next budget.
Until 94.00 is broken to the upside, pressure still remains.
Better picture if we hold here below 93.00 and push towards 90.00 again.
Italian BTPs are under pressure again, after bouncing recent highs. The narrative this time round is a top-level meeting
amongst ministers to plan the next budget. The market fears that Italy's populist government will pressure EU fiscal rules...
Yesterday we expected the Italian 10yr to break back through recent supports, after Conte's initial proposals on immigration, taxes, welfare seem to imply a decisive clash with Brussels. These measures would be good for the population, but EU will not allow them.
Further downside is expected and 90.00 is the first target.