Italy

Italy is not the only potential source of future economic instability for the eurozone, but it is the most foreseeable. Other possible triggers are a trade war and a global economic downturn — or more likely both, the Financial Times reported. A trade war remains a clear and present danger. The EU has secured a reprieve from US steel and aluminium tariffs. But the European trading bloc is dangerously dependent on the export of manufactured goods. And we should be careful not to misinterpret the announcement of a short delay as a sign of appeasement by Donald Trump.

The Hotel Dei Dogi, a lagoon-side palazzo in Venice, will be renovated in the autumn for the first time in 20 years after a U.S. investment firm snapped up the debts of its family owners, confident of selling it and eight sister hotels at a profit. In the hinterland a couple of hours' drive to the west, hotel Le Seriole, modest with a small pool and closed, is being auctioned for a fifth time this month; four previous attempts drew no bids - driving the price down by 79 percent.

The election results in Italy are a lesson to Europe. Italians were once among the most enthusiastic supporters of the European project. This is true no longer, the Financial Times reported. The combination of economic malaise with political impotence has discredited not only Italy’s political and policymaking elite, but even the country’s engagement with the EU. This does not mean Italy will leave; the costs would be too great.

The Italian state entity that took on soured debt from two failed Venetian banks is seeking partners to help restructure companies struggling to repay 9 billion euros ($11 billion) of loans, according to people with knowledge of the matter. The collapse of Banca Popolare di Vicenza and Veneto Banca left tens of thousands of small businesses in the northern Veneto region without access to financing, Bloomberg News reported. They owe billions of euros in loans classed as unlikely to pay that were taken on by state-owned SGA SpA after the lenders imploded last year.

Italian banks proved the weakest link on Monday, as an election result that saw the country’s anti-establishment parties make significant gains prompted investors to sell a sector that has outperformed the wider European market over the past year, the Financial Times reported. The FTSE Italia All-Share Banks Index dropped 2.6 per cent on Monday with Banco Intesa Sanpaolo down 1.4 per cent and UniCredit falling more than 3 per cent. Investors focused on a sector that has historically acted as a barometer for the market’s view on the wider Italian economy.

Italy's economy is forecast to grow by a decent rate of 1.5 percent this year, but that still lags the wider eurozone's estimated 2 percent, the International New York Times reported on an Associated Press story. The economy is smaller than it was at the start of the economic downturn in 2008, unemployment remains at a high 10.8 percent and wage growth is below 1 percent. Household savings, long held as the counterweight to Italy's enormous government debt, have dwindled.

"Every promise is debt - think about it," screams the message below a huge, ticking "debt clock" that greets passengers at the main train stations in Rome and Milan. The digital clocks, installed by a think tank, update Italy's 2.3 trillion-euro debt in real time, urging voters to fear election promises that analysts say could send the debt spiraling out of control after next month's vote, the International New York Times reported on a Reuters story.

A top economic adviser to Italy’s anti-establishment Five Star Movement has called on the EU to debate restructuring public debt — comments that could unnerve investors and highlights the unorthodox economic views of the party leading the country’s polls, the Financial Times reported. With three weeks to go before the nation’s general election, Lorenzo Fioramonti, an aide to Luigi Di Maio, the Five Star candidate for prime minister, said the “time is right” for a “conversation” around debt restructuring in Italy and “several other” countries.

Italian lenders set to head two new banking groups being created by merging hundreds of small cooperative banks (BCCs) must be ready to strengthen their capital if needed, the central bank's governor said on Saturday. Italy is forcing its tiny BCC banks to merge and two new groups being formed will undergo an asset check-up this year before moving under the European Central Bank's oversight because of their large size, the International New York Times reported on a Reuters story.

Intesa Sanpaolo on Tuesday unveiled an ambitious four-year plan to almost halve its stock of bad loans and boost net income, the Financial Times reported. The long-awaited strategy reboot aims to rebuild investor confidence after a turbulent period for Italy’s banking industry in which Intesa has remained profitable but has seen momentum slow. Shares in Intesa, one of Italy’s most healthiest banks, rose 1.8 per cent despite volatility on global markets, as Carlo Messina, the chief executive, revealed the new business plan.