Rather than Italy leaving the euro, so far it is the euros that are leaving Italy.
Since mid-May, after doubts had emerged about the government’s will to remain in the European monetary union, Italians have transferred dozens of billions of euros across the borders.
It took just a few days after the formation of the new government and the financial situation almost sled out of control. Italy’s liabilities with the euro-area (as tracked by the Target2 payment system) rose by €39bn to a record €465bn at the end of May, largely reflecting capital flight. Swiss monetary authorities detected money flows from across the southern border as large as to affect the exchange rate of the Swiss franc with the euro.
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|People vs finance – How Brussels should deal with Italy’s populist government||116.92 KB|