Talks of parallel currency gets bigger again in Italy after last weekend Berlusconi interview.
Following Citi , more than 2/3 of italian voters would support anti EUR parties.
The 3 right & centre rights parties will finalise a common program in september likely including parallel currency project.
Risk of Italy (even if low) going this way totally underestimated by FOREX markets but Italian Bonds have started to react negatively with Bund/BTP spread up 20 bps in the last week.
See more details in FT’ link here below :
Italy + ECB obviously not wanting to see EURO above 1,20 + ECB potential tapering discussion in september already in EUR price + more dovish Fed priced as well = EURO/USD to correct from current 1,18 to 1,20 range is becoming more and more likely.