Italy | A government crisis in the middle of a pandemic

The current Conte government looks very likely to end soon, as previous PM Renzi will withdraw his support over the next few hours. At this stage, the outcome of this crisis is very uncertain, but we see three most likely options.

What you will learn from this report:

  • None of the most likely outcomes, such as a cabinet reshuffle, a slightly different parliamentary majority with still Conte heading the government and a change of PM under the current parliamentary majority, will bring any meaningful change in economic or fiscal policies.
  • Therefore, we do not expect any strong financial markets reactions emerging from this crisis.

Topics: Europe, Eurozone, Coronavirus, Italy, Fiscal policy, Government

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