Italian politics getting interesting again

Complete uncertainty about Brexit, a persistent slowdown in activity across the entire Euro area , a dovish turn by the ECB, etc.: the European news flow in the first four months of the year has been so rich that we have (almost) forgotten the political twists in Italy, which was the focus of attention in H2 - 2018. A few days from S&P’s review of Italy’s rating, and with European elections approaching, it seems that markets are now reacting more to disagreements between the Five Star movement and the League. In this paper, we provide an update on the Italian political situation and present our scenario for the developments we see in the short term.