ANALYSIS – The markets are more worried about Liz Truss’ fiscal policy than Giorgia Meloni’s arrival in power.
While the financial markets had their eyes riveted on the historic victory of the far right in Italy, it was in the United Kingdom that panic broke out on Monday. Rather than the unknown of the “post-fascist” Giorgia Meloniit is Liz Trussthe new British Prime Minister, leader of a Conservative Party in power for twelve years, and her Chancellor of the Exchequer, Kwasi Kwarteng, who are worrying investors.
A sign of this distrust, the rates of ten-year Italian bonds rose by 0.21 point, to 4.54%, quickly caught up by those of British bonds at 4.24%, up 0.41 point over the day. Isn’t the sick man of Europe the one we think?
Reason for these tensions: the “mini” budget presented on Friday by Kwasi Kwarteng, which provides for 45 billion pounds of tax cuts in addition to 150 billion in energy support measures for households and businesses, financed by 70 billion pounds of additional borrowing next year…