As you may have heard, Italy has a new government. Now, Italy has had some governments in the past. But of the roughly 847 governments it’s had since the war, this one is unlike all of the others, because this one doesn’t think too kindly on the European Union. In fact, it thinks that Italy would have been better off if it had never joined the euro, and that if it hadn’t, the country wouldn’t be mired in a decades-long economic slump, and the Azzurri would have made the World Cup.
These are the kinds of things that tend to make investors nervous. Not Filippo Lanza. He knows his fellow countrymen, and it’s all talk. Once they settle into the reality of governing, Di Maio and Salvini will prove as docile and submissive as Greek Premier Alexis Tsipras. After all, when has a right-wing political neophyte ever made good on his economically disastrous promises? And who ever heard of a populist movement to pull a country out of the EU succeeding?
“The Italian government had been perceived as aggressive on some themes but it’s become clear that it is very focused on the issue of immigration and it has turned out to be more pragmatic than investors expected,” said London-based Filippo Lanza, who manages two bond funds for Italy’s Hedge Invest Sgr. “The market was betting on an implosion of the European Union, which we see as highly unlikely.”