- Beretta leaves Maryland over gun laws, heads for Tennessee
- Neal Boortz defends Hillary Clinton for representing child rapist
- House task force to recommend National Guard on border, faster deportations
- Top federal judge uses pizza to explain complex Obamacare situation
- Obama, Biden overhaul job training programs
- Drought-plagued Californians turn to paint to keep lawns green
- ISIL now forcing Iraqi shopkeepers to veil mannequins in Mosul
- 11 parents of Nigeria’s abducted girls die
- Genetic mapping triggers new hope on schizophrenia
- Turkish P.M. Erdogan won’t speak to Obama, but he’ll take calls from Biden
Economist expected to lead Italy’s interim government
Monti has experience in global finance, but not in politics
Question of the Day
ROME — Expectations that respected economist Mario Monti will lead a new interim Italian government helped calm market fears Thursday as the country was heading for a Greek-style crisis that would threaten the existence of the entire eurozone.
With a groundswell of Italian politicians voicing support for a technocratic government led by the former European Union competition commissioner, confidence grew that the transition of power from Premier Silvio Berlusconi will be swift.
As in Greece, where economist Lucas Papademos was appointed prime minister Thursday, there are hopes that Mr. Monti’s experience in global finance and his noninvolvement in partisan politics will help the country through market turbulence.
Italy’s 10-year borrowing rate slid sharply Thursday back toward levels that are considered manageable for now. On Wednesday, the rise in the 10-year bond yield to well above 7 percent stoked panic in financial markets that Italy was heading the same way as Greece, Ireland and Portugal and might need outside help.
“Professor Mario Monti wanted to express his heartfelt thanks” to the president for being named a lifetime senator, the palace said in a one-line statement.
Although Mr. Monti can only be named premier after Mr. Berlusconi hands in his resignation, his meeting with Mr. Napolitano will allow him to explain how he intends to command enough loyalty in the Italian legislature to ensure swift implementation of economic reforms needed to revive growth.
Mr. Berlusconi, arriving at the Senate, where the budget committee approved the reforms Thursday evening, was asked by reporters whether his splintering People of Freedom party could back a broad coalition government following his resignation.
“We’ll see,” Mr. Berlusconi said.
As hopes grew for a swift handover of power in Rome, the government easily sold $6.8 billion in 12-month bonds at an interest rate of 6.087 percent. Though that is up sharply from 3.57 percent in the auction last month, it was well below analysts’ expectations of 7 percent. Demand for the bonds was also strong, almost twice the amount on sale.
The European Central Bank has been buying up Italian and Spanish bonds in the secondary markets to help keep borrowing rates from becoming unsustainable. There’s speculation that the ECB was back in the markets Thursday trying to get Italy’s borrowing rates down. The ECB did not comment.
According to the EU’s latest forecast, which does not take into account the most recently promised reforms, Italy will still run a deficit of 1.2 percent of national income, with debt close to 119 percent of economic output.
TWT Video Picks
The president could pay the full price for ignoring Congress
- IRS seeks help destroying another 3,200 computer hard drives
- Beretta moving to Tennessee over Maryland gun laws
- D.C. appeals panel deals big blow to Obamacare subsidies
- 'Straight White Guy Festival' supposedly set for Ohio park
- CARSON: Costco and the perils of mixing politics and business
- PRUDEN: A deadly enemy within exacerbating immigration crisis
- LYONS: Small-arms treaty, big Second Amendment threat
- YOUNG: A sinking presidency, deeper after November?
- MERRY: Handicaps in Hillary's way
- Obama family set to buy $4.25M desert home in California: report
Obama's biggest White House 'fails'
Celebrities turned politicians
Athletes turned actors
20 gadgets that changed the world
Fighting in Iraq