Italy’s borrowing costs jumped to record levels on Friday, underlining its vulnerability at the heart of the eurozone debt crisis and skepticism about whether the struggling government of Italian Prime Minister Silvio Berlusconi can deliver vital reforms.
The 6.06 percent yield paid at an auction of 10-year bonds was the highest since the launch of the euro, and not far from the level reached before the European Central Bank intervened in August to cap Rome’s borrowing costs by buying Italian debt.
Italy, the eurozone’s third--largest economy, is again at the center of the debt crisis, as fears grow that its borrowing costs could hit levels that overwhelm the capacity of the bloc to provide support amid chronic political instability in Rome.
In a speech in Rome, Berlusconi insisted that Italy would meet its target of balancing the budget by 2013.
Tainted by scandal and repeatedly at odds with his coalition allies, Berlusconi has promised his European partners a package of measures meant to spur Italy’s stagnant economy and cut its towering public debt, but has failed to convince markets made skeptical by his repeated failure to deliver reforms.
European leaders welcomed a letter of intent on reforms that he delivered to their summit last Wednesday, but emphasized that the measures must now be implemented.
“The interest rates that they are paying are punitive,” Monument Securities strategist Marc Oswald said. “Italy ... is still the bete noire of the whole eurozone problem.”
“They are still going to carry on having to pay higher yields unless they come up with reform plans and implement them, but anyone who expresses an optimistic opinion about that is probably looking through rose-tinted glasses,” he added.
France and Germany have expressed open exasperation at a succession of unfulfilled reform promises by Berlusconi, and fear the crisis in Italy could spark a wider emergency that would threaten the very existence of the single currency.
Even if a weakened government manages to pass the promised reforms, most will not come into force until the middle of next year. Markets are unlikely to remain patient for so long.
In his speech, Berlusconi took aim at the euro, calling it a “strange” currency.
The Taipei MRT is open all night tonight following New Year’s Eve festivities, and is offering free rides from nearby Green Line stations. Taipei’s 2025 New Year’s Eve celebrations kick off at Taipei City Hall Square tonight, with performances from the boy band Energy, the South Korean girl group Apink, and singers Gigi Leung (梁詠琪) and Faith Yang (楊乃文). Taipei 101’s annual New Year’s firework display follows at midnight, themed around Taiwan’s Premier12 baseball championship. Estimates say there will be about 200,000 people in attendance, which is more than usual as this year’s celebrations overlap with A-mei’s (張惠妹) concert at Taipei Dome. There are
ANNOUNCEMENT: People who do not comply with the ban after a spoken warning would be reported to the police, the airport company said on Friday Taoyuan International Airport Corp on Friday announced that riding on vehicles, including scooter-suitcases (also known as “scootcases”), bicycles, scooters and skateboards, is prohibited in the airport’s terminals. Those using such vehicles should manually pull them or place them on luggage trolleys, the company said in a Facebook post. The ban intends to maintain order and protect travelers’ safety, as the airport often sees large crowds of people, it said, adding that it has stepped up publicity for the regulation, and those who do not comply after a spoken warning would be reported to the police. The company yesterday said that
NEW YEAR’S ADDRESS: ‘No matter what threats and challenges Taiwan faces, democracy is the only path,’ William Lai said, urging progress ‘without looking back’ President William Lai (賴清德) yesterday urged parties across the political divide to democratically resolve conflicts that have plagued domestic politics within Taiwan’s constitutional system. In his first New Year’s Day address since becoming president on May 20 last year, Lai touched on several issues, including economic and security challenges, but a key emphasis was on the partisan wrangling that has characterized his first seven months in office. Taiwan has transformed from authoritarianism into today’s democracy and that democracy is the future, Lai said. “No matter what threats and challenges Taiwan faces, democracy is the only path for Taiwan,” he said. “The only choice
CORRUPTION: Twelve other people were convicted on charges related to giving illegal benefits, forgery and money laundering, with sentences ranging from one to five years The Yilan District Court yesterday found Yilan County Commissioner Lin Zi-miao (林姿妙) guilty of corruption, sentencing her to 12 years and six months in prison. The Yilan District Prosecutors’ Office in 2022 indicted 10 government officials and five private individuals, including Lin, her daughter and a landowner. Lin was accused of giving illegal favors estimated to be worth NT$2.4 million (US$73,213) in exchange for using a property to conduct activities linked to the 2020 Chinese Nationalist Party (KMT) presidential and legislative election campaigns. Those favors included exempting some property and construction firms from land taxes and building code contraventions that would have required
RSS