Italian PM Doubles Down Calls New Confidence Vote

taly’s prime minister is facing another vote of confidence on Wednesday – this time of his own making rather than due to a political crisis – sparking concerns that the government is “fiddling while Rome burns.”
Prime Minister Enrico Letta called the vote of confidence after Silvio Berlusconi, the leader of the “Forza Italia” party, pulled his support from the coalition government. This vote of confidence is designed to confirm Letta’s new majority, the government said, and comes only a few weeks after the last vote of confidence on the country’s 2014 budget.

Ahead of the vote on Wednesday morning, Letta told the Italian parliament that Italy must avoid “chaos” and that the country’s priorities for 2014 were to cut Italy’s public debt and deficit as well as reducing taxes on families and companies and boosting employment, Reuters reported.

That’s easier said than done in a country with the second highest debt pile in the euro zone after Greece, at 133 percent of its economic output, a budget deficit hovering around the European limit of 3 percent and unemployment at a record high of 12.5 percent in October.

The prime minister also promised a reform package to boost growth on Wednesday. Italians have suffered the effects of more than two years of recession and a fragile coalition government that struggled to enact meaningful reforms due to political volatility.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza