12 August, 2020

Italy ought to be ready for ‘all eventualities’ on euro: Savona

ROME (Reuters) – European Affairs Minister Paolo Savona said that Italy needed to be ready for "all eventualities" regarding its membership in the euro zone, which might be based upon factors outside its control.

Italy's anti-establishment League/5-Star Movement coalition had nominated Savona to get its first economy minister a few weeks ago, but President Sergio Mattarella vetoed the appointment on account of Savona's scepticism about euro zone membership.

The academic who had previously been eventually named economy minister, Giovanni Tria, has committed Italy to keeping the euro.

"Organic meat find ourselves in a situation where it's not we who decide but others," Savona told a panel of senators. "My position regarding an insurance policy B … is that often we have to be prepared for all eventualities."

Italian bond yields initially rose after Savona's remarks and Milan's blue-chip share index erased earlier gains, but yields returned for their previous levels and stocks partially recovered.

"They are a well-known eurosceptic and that he appears to be being deliberately provocative," said Chris Scicluna, head of economic research at Daiwa Capital Markets in the uk.

"Into the extent which we knew his views already, up to date comments produce a reminder that there are individuals in the federal government by using these views understanding that an italian man , government is on a road to confrontation while using Western european," he added.

The governing coalition of the 5-Star Movement as well as the right-wing League plans sweeping tax cuts far better welfare spending, that is gonna lead the government to renegotiate its budget deficit targets with Brussels.

Bank of Italy Governor Ignazio Visco warned the federal government on Tuesday being cautious with public finances in order to avoid upsetting markets and increasing public debt, which is the highest inside the euro zone after Greece's.

Savona, an 81-year-old former university professor, wrote within a book published this holiday season that Italy's entry in the euro zone would have been a "historic mistake". He’s a distinguished academic record as well as once worked along at the Bank of Italy.

Savona told the senators he would meet with European Central Bank President Mario Draghi "once this encounter has expired," but he later told reporters the meeting will not be , while they had assumed.

He said he designed to meet Draghi though the appointment we had not yet been arranged.