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Will Italy say no to the Euro?

Prime Minister Matteo Renzi

4th December 2016 marks the day Italy will hold a referendum for a constitutional reform. The referendum will decide on whether Italy should reduce the powers of the senate and regional government. Many protestors may take the position of ‘no’ to protest against the government.

 

What will be the implications if Italy say ‘no’? Prime Minister Matteo Renzi may resign causing Italy to be in a state of instability and panic in the financial markets. The implication of this will be that Italy borrows 5.3 billion Dollars to clear debts. It may also mean that the weaker banking sector could struggle keeping up with the economical uncertainty.

 

Supporters of ‘no’ on the referendum could also support a further decision to say no to the Euro as their currency and possibly leave the EU within the coming year. What will this mean for your foreign exchange? This might mean your foreign exchange broker will increase its margins on the live exchange rate to make up for the instability in the financial markets. If Italy do decide to leave the EU then that may make accessibility of send money to Italy difficult to the average remitter entirely.

 

For more information, watch the video below and share your thoughts.  


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