Referenda stand as a dangerous gamble nowadays. Only the Swiss can manage them with relative ease. Populism can boast of triggering another staggering crisis in Europe as voters rejected by a wide majority the Constitutional reform tabled by the Italian PM. Opposition to his initiative also came from fellow members of the Democratic Party, such as D’Alema, and respected politicians like Monti. Conceding defeat, Mr Renzi has resigned from office throwing the country into utter disarray.
AXA IM | Those wishing for a successful constitutional reform in Italy need to be aware that it could actually trigger a referendum on the euro. Growing nerves here likely explain the widening of the spread between German and Italian bonds as investors try to hedge ‘currency’ risk.