Monti seeks to calm markets and EU leaders on Italy’s future

Premier sees ''no vacuum'' in decision-making

10 December, 19:22

Monti seeks to calm markets and EU leaders on Italy’s future Monti seeks to calm markets and EU leaders on Italy’s future

(ANSAmed) - Rome, December 10 - Italian Premier Mario Monti on Monday attempted to calm nervous markets worried that Italy would backpedal on reforms aimed at bringing its debt under control.

Investors fled from the Milan Stock Exchange Monday, driving shares down by over 3%, following Monti's surprise resignation on Saturday.

Meanwhile, in a sign of the difficulties facing the country, the spread between Italy's 10-year Btp government bonds and their German equivalent spiked upwards Monday after declining gradually over the past months.

Earlier Monday, Monti warned against reading too much into the oscillations of the market, saying that people should not ''dramatise the reactions'' to his resignation announcement.

Investors - and international leaders - reacted nervously to Monti's resignation, worrying that the international credibility he restored to Italy would be lost were a return to politics as usual slow-down the country's reform process.

Speaking from Oslo, where Monti attended the awarding of the Nobel Peace Prize to the European Union, the outgoing premier said later that ''markets shouldn't fear a decision-making vacuum'' in Italy.

From Oslo, the outgoing premier said that Italy faced several ''challenges'' in its quest to achieve higher growth and employment. The challenges will be ''particularly intense'' for those ''who like Italy, in the past, unfortunately waited too long to tackle the imbalances in public finances.'' Investors weren't the only ones feeling choppy Monday.

Newspapers and commentators were also speculating - about whether Monti would somehow seek to remain involved in Italy's politics.

Were he to run for office, Monti would have to make his intentions clear soon, given the relatively short timetable leading up to new elections in February.u' However, some reports suggested the respected former European Commissioner might serve as a member of a centre-left government, should Italy's Democratic Party (PD) win the upcoming elections.

''In this past year Monti and Bersani have understood each other well. I am certain that they will find the best solution,'' Enrico Letta, the PD's second in command, said Monday referring to the working relationship between Monti and PD leader Pier Luigi Bersani.

On Monday, Bersani attempted to disparage the idea of Monti running for office. ''In the future I think it will be possible to have a relationship with Monti in the name of Italy, [but] it would be easier if Monti remained out of the electoral contest,'' Bersani said. (ANSAmed).

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