Italy

Let this sink in for a minute: Yields on two-year Italian government bonds briefly fell below 0% on Tuesday. That's right - for a moment, investors decided it was just fine to pay Italy for the privilege of lending it money, even though barely a month ago the country was on the verge of a fiscal crisis so bad some wondered whether it would be need to leave the euro zone, a Bloomberg View reported. It matters little that yields ended the day on the right side of zero at 0.02%, but even that shows how the “greater fool” theory in markets has gone too far.

Rome’s populist government has revised its ambitious spending plans in an effort to avert EU budget sanctions. Italy’s rising debt burden — at 132 per cent of gross domestic product the second-highest in the eurozone — is in breach of EU budgetary rules, according to an assessment by the European Commission last month, putting it at risk of becoming the first country to incur financial penalties, the Financial Times reported. Ministers reached an agreement on Monday evening on a law to adjust the budget in the hope of averting an excessive deficit procedure (EDP) by the EU.

German Efromovich, the ousted chairman of Colombian airline Avianca, is eyeing a comeback via Italy. Efromovich wants to buy a stake in the bankrupt Italian flag-carrier Alitalia SpA, financial daily Il Sole 24 Ore reported, citing a phone interview, Bloomberg News reported. "We wrote a letter to Ferrovie dello Stato and the adviser Mediobanca two weeks ago saying we can purchase up to 30% of Alitalia," said Efromovich, who was removed as the chairman of Avianca Holdings SA last month after a loan breach.

The EU is in a state of suspended animation over Italy’s budgetary woes. Wednesday was supposed to be the day when Brussels gained clarity over Rome’s intentions to step back from deficit-busting spending measures and avoid falling into an EU disciplinary process, the Financial Times reported. But clarity, there came none. Italy’s fraying anti-establishment coalition — which is divided between budget moderates and hardliners — decided on Wednesday to delay formally setting itself a lower deficit target for 2020.

The European Commission could give Italy until January to make fiscal policy changes under an EU debt procedure, minutes of an EU meeting show, setting a relatively long deadline to help avert fines and any backlash from Rome’s eurosceptics, Reuters reported. Unless the government makes concessions this week on its spending plans for 2019 and 2020, the EU executive is expected to propose on July 2 that a disciplinary procedure be opened over Italy’s rising debt.

Italy risks further infuriating European Union finance chiefs after Prime Minister Giuseppe Conte said he was in favour of a broad reform that would cut taxes, Express.co.uk reported. As the two sides brace to collide yet again, Mr Conte said he agree with deputy prime minister and far-right leader Matteo Salvini, who is calling for significant tax cuts. Mr Salvini has threatened to bring down the Italian government should his proposals not be met.

Dubai developer Damac is in pole position to buy troubled Italian fashion group Roberto Cavalli, a source close to the matter said on Wednesday, Reuters reported. Two other binding offers for the whole group have been submitted by Italy’s Diesel-owner OTB and U.S. brand management company Bluestar Alliance, the source said. Last Friday Cavalli said it had received five offers for the brand. The company and its private equity owner Clessidra both declined to comment.

The percentage of families living in poverty in Italy rose to a record high last year as a prolonged economic stagnation and persistent high unemployment continued to take their toll on the country, the Financial Times reported. About 7 per cent of Italy’s families lived in “absolute poverty” last year, according to data from the national statistics office ISTAT released on Tuesday. This is the highest level since comparable data were made available in 2005 and is double the rate from the pre-crisis period.

An Italian parliamentary committee is set to approve later on Monday a tax measure to spur mergers among banks based in the country’s poorer south, a lawmaker of the ruling League party said, warning of lenders in the region at risk of default, Reuters reported. “We’re tackling an urgent issue,” Giulio Centemero, a member of the lower Chamber of Deputies, told Reuters. “Banks are key for the Italian economy and ...

An Italian parliamentary committee is set to approve later on Monday a tax measure to spur mergers among banks based in the country’s poorer south, a lawmaker of the ruling League party said, warning of lenders in the region at risk of default, Reuters reported. “We’re tackling an urgent issue,” Giulio Centemero, a member of the lower Chamber of Deputies, told Reuters. “Banks are key for the Italian economy and ...