Italy: Election story hasn’t moved on significantly – Deutsche Bank

The Italian election story hasn’t moved on significantly since yesterday morning but there has been some posturing, according to analysts at Deutsche Bank.

Key Quotes

“As a reminder the populists of 5SM and the Northern League remain the biggest winners. Arithmetically these two could form a coalition but the former has previously suggested they won’t enter a coalition. However their success means that a government will be incredibly difficult to form without them. Their leader Di Maio did say that 5SM’s victory should allow him to govern Italy and that we are open to talks with all parties. So we’ll see if that means they’re more open to a coalition than before.”

“Meanwhile NL leader Salvini said on live TV that “the centre-right coalition is the coalition that won”. He also said that result requires NL “to be responsible” and that the NL not available for “bizarre coalitions” and that “We want to govern with the centre-right.” This would argue against the desire for a 5SM tie-up. It’s also worth noting that Salvini did say that “the common currency system is bound to come to an end….not because Salvini wants that but because that’s what facts, good sense and the real economy say”. So although his party haven’t been pushing to leave the euro recently he is clearly very negative about the single currency’s future which is interesting for someone who could be a kingmaker. However he has always felt this way so it’s not really new news. Elsewhere, Mr Renzi noted the results were “very disappointing” for the Democratic Party and has resigned as Party Leader.”