Italian government announcement shakes markets

The Milan Stock Exchange has lost more than 2% since its opening following the announcement of the Italian government to increase its deficit of 2.4% of GDP to close the 2019 budget. This percentage is well above that of the former Italian government which committed up to 0.8% of GDP.

Italy's deficit currently represents 131% of its GDP. Italy therefore complies with the European norm of not letting the national deficit go above 3% of GDP but does not follow the recommendations of Brussels that the country should reduce its overall deficit.

The effect of the announcement was therefore directly felt on the financial markets and should continue to impact them in future sessions. At the currency level, the euro lost ground against the dollar (EURUSD 1.1620 on 28/09/18 at 10:33) and other currencies such as CAD, AUD and ZAR.