• but strength has helped pushed inflation too low

Nothing new in the mantra from Bank of Italy gov. at the BOI annual meeting.

  • ECB determined to act to ensure price stability
  • Eurozone needs more integration, “a true common project”
  • ECB should counter excessive low inflation with firmness

For “firmness” I guess we need to assume “action”

We’ll see soon enough next week. EURUSD still going nowhere in a hurry at 1.3606

On Italy:

  • Italy’s exit from recession is “laborious”
  • recovery is fragile and uncertain, needs investment
  • Italy has lost 15% of manufacturing capacity since 2008, investment as proportion of GDP hit post-war low in 2013
  • BOI ready to adopt measures to improve banks’ liquidity so they can increase lending to firms
  • Italian banks must take action to dispose of bad loans may be interest from foreign and domestic investors