Italy's new economy minister rules out euro exit

Postado Junho 13, 2018

In his first interview since taking office a week ago, Giovanni Tria told the Corriere della Sera newspaper on Sunday the coalition was committed to remaining in the single currency and wanted to boost growth through investment and structural reform.

"Maybe Tria's comments are a bit more blunt and reassuring than markets were expecting and that explains the move in Italian bonds, but we are still in an illiquid market for BTPs and that's illustrated in the market reaction", said ING senior rates strategist Martin van Vliet.

"These will be fully coherent with the objective of continuing on the path of lowering the debt/GDP ratio", he said. He was eventually handed a less important portfolio after the head of state refused to accept his nomination.

"The position of the government is clear and unanimous".

"The government is determined to prevent in any way the market conditions that would lead to an exit materialising".

If a referendum was held on ditching the euro, only 29% would vote to leave, with the rest undecided.

Tria said he had spoken to his German counterpart and was looking for "fruitful dialogue" with the European Union, adding that Italian interests chimed with those of Europe.

As reported by the Reuters news agency, Tria also challenged the notion that Italy might indulge in a public spending spree after promises by the new government that it would roll back pension reform and increase welfare spending.

He declined to say whether the coalition would hike the deficit target, but said he aimed to meet existing 2018 and 2019 debt reduction goals.

"As part of the debt reduction and deficit reduction goals, the budget will reflect the basic choices on how and when to implement the [government] program", he said.

One of the most radical proposals that has surfaced in recent weeks is to issue securities to pay off individuals and companies who are owed money by the state as payment for services or as tax rebates. "The range of issues he is talking on raises question marks about the agreed programme between 5-Star and League", he said, referring to the two parties in Italy's coalition.