Italy is experiencing a severe risk spread increase over German bunds, highlighting the daunting challenge posed by its 140% debt-to-GDP ratio without the ability to print its own currency.
The Eurozone’s next crisis is already approaching, in #Italy. 10y risk spread over German bunds have spiked >200bps. Debt ratio of 140% of GDP is a real challenge for a „sub-sovereign“ borrower that no longer prints its own currency. t.co/7Sf4VlBx0l pic.twitter.com/MYHlQf0LVj
— Holger Zschaepitz (@Schuldensuehner) October 20, 2023
The EU’s surging expenses for interest payments, pensions, and healthcare are taking a toll on funds for defense and strategic investments. This escalating financial burden is seriously straining member states’ fiscal health, with countries like Italy, France, Germany, and Spain experiencing the hardest hits.
🇪🇺 The EU is spending more and more on interest payments, pensions, healthcare which is impacting availability of funds for defence and strategic investments
As SCOPE highlights, these rising expenditures are worsening member states’ fiscal balances, with the most severe hits in… pic.twitter.com/p5671MIymS
— Nikolay Kolarov, CFA (@libertniko) October 20, 2023