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‘Lo spread’: The collateral damage of Italy’s confrontation with the EU

Claeys, Gregory and Mazza Jan, “‘Lo spread’: The collateral damage of Italy’s confrontation with the EU“, Bruegel.org, July

The authors assess whether the European Commission’s actions towards Italy since September 2018 have had a visible impact on the spread between Italian sovereign-bond yields and those of Germany, and particularly whether the Commission’s warnings have acted as a ‘signalling device’ for bond-market participants that it might be difficult for Italy to obtain the support of the ESM or the ECB’s OMT programme if needed.

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