Italian Populists’ Proposals Face Difficult Road, Analysts Say
- Fiscal loosening measures could be toned down amid challenges
- Bonds, stocks seen supported by ECB policy and valuations
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While Italy’s populist duo nears the completion of a governing plan that includes a flat tax and guaranteed income for the poor, markets are taking the news in their stride as investors and analysts say some of the parties’ proposed policies will likely encounter roadblocks.
The FTSE MIB Index was down 0.4 percent on Monday, underperforming the rest of Europe, while the spread between Italy’s 10-year bond yields and German bunds was little changed at 132 basis points, after the anti-establishment Five Star Movement’s leader Luigi Di Maio and his anti-immigrant League counterpart Matteo Salvini refined the last details of their program before meeting President Sergio Mattarella later Monday.