France and Italy head for trouble - Ambrose Evans-Pritchard

Italy 

The budget deficit for 2023 may ultimately hit 10pc of GDP

If that can’t buy you a false boom, nothing can.

Scope Ratings says Italy could become ineligible for bond purchases under the European Central Bank’s spread control tool (TPI). 

That in turn brings Italian solvency back into focus. Meloni mania is over.

#AskECB With the TPI, the ECB now decides the political landscape in the EU, making populist spending and election possible, since the "normal mechanism" of spread increase does not happen. When did the ECB's remit move into deciding who should be in power, and why populists?

@Isabel_Schnabel: The TPI can only be activated to counter unwarranted, disorderly market dynamics posing a threat to monetary policy transmission across the euro area. Eligibility requires that countries pursue sound and sustainable fiscal and macroeconomic policies. 

https://www.ecb.europa.eu/press/inter/date/2024/html/ecb.in240110~27228ebd87.en.html

Who exactly is responsible for a bank rescue in the eurozone

https://englundmacro.blogspot.com/2023/05/who-exactly-is-responsible-for-bank.html

France

The Cour des Comptes says Mr Macron has allowed a careless degradation of the public finances, and will now face a reckoning. “The budget for 2025 is going to be the most brutal since the financial crisis,” it said.

Both France and Italy face the long grind of retrenchment, again governed by the EU Stability Pact. 

It is bad enough to endure your own austerity, it is worse yet to have it imposed by ordoliberal budget commissars in Brussels.

Ambrose Evans-Pritchard Telegraph 9 April 2024

https://www.telegraph.co.uk/business/2024/04/09/britain-on-mend-france-italy-heading-for-trouble/