Meanwhile, Italy’s main banking index slid by 3 per cent, hit by fears that the ongoing attempts to strengthen several lenders could be at risk.
Shares in Monti dei Paschi, Italy’s oldest bank, have slumped by 6 per cent in early trading.
There are particular fears about Monte dei Paschi which is trying to raise €5bn in new capital and offload €28bn of bad loans.
Claus Vistesen, chief euro zone economist at Pantheon Macro, said in a note: “The economy could easily grind to a halt due to political uncertainty. It could also prevent urgent action on the country’s ailing banks. A deal with the EU on recapitalization can’t be postponed for much longer if Italian politicians want to avoid a sudden failure of one or more of the country’s mid-size banks.”
(Sourced from agencies, feature image courtesy:oneindia.com)
