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Cottarelli: “Now we need to stop inflation. State aid? Only to the weakest”

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Cottarelli: “Now we need to stop inflation. State aid? Only to the weakest”

Rome, 11 June 2022 – Interest rates are rising, the stock market is collapsing, the euro is under pressure, the spread is once again scary. A “save whoever can” situation. What can you do? Carlo Cottarelli, an economist of rank, former director of the Department of Fiscal Affairs of the International Monetary Fund, has some ideas. Italian stock market at peak, BTP spread over 230 points Increase in ECB rates, effects on mortgages and loans Professor, the ECB turns the page. Raise interest, freeze purchases of government bonds starting from July. The result is that the spread flies, the stock market loses more than 5% and bank stocks are under pressure. Don’t you risk the perfect storm? “This is an inevitable and expected change. Because with inflation at 8% in the euro area, negative interest rates and bank deposits that yield less than zero, there was a risk of heavily penalizing savings. Of course, inflation it is due to external factors. But the erosion of purchasing power essentially depends on the fact that we have to pay 80 billion euros more for imports. It is true that the Treasury has put in 35 billion to mitigate the blow. someone has to pay the bill. ” How can we save ourselves? “We must carefully select the interventions, avoid for example measures such as cashback that favor high incomes. And aim to support those who suffer most in this situation. We do not have the resources to protect everyone”. Are you not thinking of a patrimonial? “But no, we are not in an emergency situation so serious as to impose a measure of this type. I am only saying that we must be selective”. How much does the international political situation weigh on the spread? “I do not think it is decisive. The increase is the direct consequence of the new monetary policy. In 2021 all the Italian public debt …

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