Juncker: "If Italy leaves the euro, it will be suicide"

A scenario in which Italy leaves the euro is virtually out of the question, because it would be economically suicidal. That Said the President of the European Commission, Jean-Claude Juncker on Friday in a conversation with the Austrian broadcaster ORF. According to him, there is therefore no reason to be concerned about a possible departure of Italy from the currency union.

Last month, the budget of the new Italian government was rejected by the European Commission, because the projected budget deficit of 2.4% is not in line with the European agreements to reduce the public debt to a maximum of 60% of gross domestic product. It is the first time that the European Commission has rejected a country's budget, causing renewed speculation about Italy's possible departure from the currency union.

'Italy will suffer the consequences'

Italy is due to submit a new budget to the European Commission by mid-November. If the country still does not comply with the rules, Juncker believes that the country will be "Suffering the consequences of having to". With this threatening tone, Juncker is trying to call the Italian government to order, but it remains to be seen whether they will comply.

According to the president of the European Commission, most Italians want to stay in the eurozone, because they somehow feel that the euro protects them. He is referring to the protection offered by the single currency against devaluations, which were common in the past when the country still had its own currency. With the euro, the Italian Government does not have that possibility. Due to concerns about creditworthiness, Italian government bond yields have risen sharply in recent months.

This contribution was made from Geotrendlines