Analysts at ING, suggests that the election of EU Commission President Ursula von der Leyen by a very narrow majority may have raised concerns about the stability of the newly-formed European administration.
“What may be equally concerning, is that only one party in the current Italian coalition (5 Star) voted in favour, while the League voted against. It is another sign that the already faltering coalition may soon break down.”
“At this stage, it is fair to assume that markets should prepare for more Italy-induced volatility in rates and FX markets ahead. Along with a dovish ECB, this may be a temper EUR/USD upside in the coming months.”
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