IMF: Italy must introduce spending cuts

| July 13, 2011 | 0 Comments
”IMF:

The International Monetary Fund (IMF) is urging Italy to introduce austerity measures to lower the country’s debt.

Its warning comes as there are fears that the euro zone’s third largest economy could be dragged into the euro zone’s debt crisis as it has the second highest sovereign debt ratio in the region.

As a result, the Government is now pressing ahead with a programme of spending cuts.

An IMF report said “decisive implementation of the package is key and the IMF feels that more front-loaded spending measures would have a positive effect on market sentiments.”

Fears for Italy becoming the next victim of the crisis has sent European shares falling while the euro has lost ground against many currencies.

An emergency meeting took place on Monday in Brussels as EU officials met to discuss the ongoing crisis in the euro zone.

Furthermore, the yield on Italian bonds continue to rise to levels that could put pressure on Italy’s public finances, according to analysts.

In addition, investors are concerned that Italy’s banks will not pass stress tests – results are due on Friday.

In other news, credit rating agency Moody’s said there was increasing likelihood that Ireland may need a second bailout from the European Union and the IMF after it cut the country’s debt rating to junk status.

Fears for Italy becoming the next victim of the crisis has sent European shares falling while the euro has lost ground against many currencies.

An emergency meeting took place on Monday in Brussels as EU officials met to discuss the ongoing crisis in the euro zone.

Furthermore, the yield on Italian bonds continue to rise to levels that could put pressure on Italy’s public finances, according to analysts.

In addition, investors are concerned that Italy’s banks will not pass stress tests – results are due on Friday.

In other news, credit rating agency Moody’s said there was increasing likelihood that Ireland may need a second bailout from the European Union and the IMF after it cut the country’s debt rating to junk status.

Tags: , , , , , , , , , , ,


Comments (0)

Trackback URL | Comments RSS Feed

There are no comments yet. Why not be the first to speak your mind.

Leave a Reply


Visited 772 times, 2 so far today