Italy Bonds Fall on EU Rebuke as Goldman Warns It's Not Over Yet

EU rejects Italian budget, while PM Conte rules out Plan B
Market ‘may need to get worse before it gets better’: Goldman

Bloomberg’s Alessandra Migliaccio reports on the buget battle between Italy and the EU.Source: Bloomberg)

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By John Ainger and James Hirai

October 23, 2018 at 4:00 AM UTC

Updated on

October 23, 2018 at 3:45 PM UTC

This article is for subscribers only.

Italy’s bonds slid as the European Commission rejected the country’s budget to escalate a standoff that has rattled regional markets.

The debt was also pressured by Italian Prime Minister Giuseppe Conte insisting there is no “Plan B” on a budget that calls for a higher deficit. German and U.K. bonds rose on demand for safer assets. Markets may have to increase pressure on the government to change its fiscal policy, according to Goldman Sachs Group Inc.