Europe’s Stoxx 600 turned negative on Tuesday after Bloomberg published a document showing the Italian government’s projected budget deficit for 2019 is even larger than the Italian Treasury had suggested last week, putting Italy’s populist leaders on the path to anotheer destabilizing showdown with Brussels.
Italy is now projecting a budget deficit equivalent to 2.5% of GDP, larger than the 2.3%-2.4% from projections released last week, and nearly 50 basis points above the agreed-upon 2.04% target from a peace accord with Brussels reached late last year. The leaked document, cited by Bloomberg, affirmed that the government anticipates GDP growth to slide to just 0.1%, down from 1% in prior forecasts.
Italian bond yields climbed on the headline…
…while Italian stocks dragged the broader European market lower.
We now await a reaction from Brussels, which we imagine will have something to say given that the Italian government has now been exposed for lying to the European Commission.
via ZeroHedge News http://bit.ly/2uUDlej Tyler Durden