Italy financial markets plunge on political turmoil

Financial markets are nervous as Italy faces the prospect of new elections as early as September after a nascent populist government collapsed over the weekend, prolonging almost three months of uncertainty. 

Italy financial markets plunge on political turmoil

World Bulletin / News Desk

The Milan stock exchange plunged more than three percent Tuesday, while Italy's 10-year bond yields jumped to over 300 points higher than Germany's, reflecting investor worry over the prospect of a fresh eurozone crisis.

At close on Monday, Italy's 10-year bond yields were 235 points more than Germany's, its highest levels since 2013, before surging to over 300 points Tuesday morning. 

Italy was waiting Tuesday for caretaker prime minister and former IMF economist Carlo Cottarelli to assemble a cabinet lineup for a technocrat government after a bid for power by populists failed to get off the ground over the weekend. 

President Sergio Mattarella vetoed the populists' pick for economy minister, fierce eurosceptic Paolo Savona, throwing the eurozone's third largest economy into a fresh crisis.

For Cottarelli to form a government, parliament must endorse his team -- something the nationalist League party and the Five Star Movement who hold a majority in both houses have staunchly refused to do.

In the absence of a confidence vote Italy could return to the polls as early as September.  

Güncelleme Tarihi: 29 Mayıs 2018, 12:42