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Morningstar DBRS said that even if Italy falls back into political turmoil, the country will probably still abide by the EU's budget discipline. DBRS believes that the main political risk is that the election results are pending, leading to a suspended parliament, but the risk that the next administration will drastically deviate from EU fiscal rules is limited. Rising interest burdens and other factors will continue to limit fiscal prospects, so the next administration must renew Italy's commitment to prudent fiscal policy and put in place credible measures.
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Morningstar DBRS said that even if Italy falls back into political turmoil, the country will probably still abide by the EU's budget discipline. DBRS believes that the main political risk is that the election results are pending, leading to a suspended parliament, but the risk that the next administration will drastically deviate from EU fiscal rules is limited. Rising interest burdens and other factors will continue to limit fiscal prospects, so the next administration must renew Italy's commitment to prudent fiscal policy and put in place credible measures.
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