Guide to What Italy Election Will Mean for Financial Markets
- Uncertainty over new government policy could hurt risk assets
- Banks, energy and state-controlled firms likely to be in focus
Attendees at a Brothers of Italy election campaign event in Duomo square in Milan, Italy, on Sept. 11. A right-wing coalition is widely expected to win Italy’s election on Sunday.
Photographer: Francesca Volpi/BloombergMario Draghi injected some confidence into bruised Italian markets after becoming prime minister in February 2021, driving reforms and forging a strong relationship with Brussels. His impending exit adds to a growing list of worries for domestic assets.
A right-wing coalition is widely expected to win Italy’s election on Sunday, bringing fresh uncertainty for investors already fretting over rising interest rates, an energy crunch and a potential recession. Such an outcome may raise doubts over the path of reforms that are a condition for the country to receive European Union funds to hasten its post-pandemic recovery.