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Investment Talks - Italian budget proposal under scrutiny

United Kingdom,

  • The key points of the budget law. The Italian Government negatively surprised the markets by announcing a substantially increased budget deficit target for 2019-2021 to 2.4% in a move that could undermine the potential to reduce the Italian debt burden (130% of GDP) in the coming years.
  • Market reactions: The Italian move has triggered a selloff on Italian assets (bonds, equities and banking sector in particular). Uncertainty will remain high with debt sustainability under scrutiny by markets and rating agencies expected to reassess the country rating by end of October. A downgrade is now more likely.
  • Our view: On Italian debt we have a neutral view and will continue to monitor the details of the budget law and developments in the economic outlook. We stay cautious on Italian equity where we focus on less leveraged companies. Short-term volatility could impact European equity, but we are more constructive on mid-term outlook.

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Amundi, the leading European asset manager, ranking among the top 10 global players[1], offers its 100 million clients - retail, institutional and corporate - a complete range of savings and investment solutions in active and passive management, in traditional or real assets.

With its six international investment hubs[2], financial and extra-financial research capabilities and long-standing commitment to responsible investment, Amundi is a key player in the asset management landscape.

Amundi clients benefit from the expertise and advice of 4,800 employees in more than 35 countries. A subsidiary of the Crédit Agricole group and listed on the stock exchange, Amundi currently manages nearly €1.8 trillion of assets[3].

 

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Footnotes

 

  1. ^ [1] Source: IPE “Top 500 Asset Managers” published in June 2021, based on assets under management as at 31/12/2020
  2. ^ [2] Boston, Dublin, London, Milan, Paris and Tokyo
  3. ^ [3] Amundi data as of 30/06/2021

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