Italy’s populist parties finally reached a deal to form a coalition government on Thursday evening after nearly three months of political deadlock – a prospect likely to chill the EU and shake financial markets.
After days of intensive negotiations, the anti-immigrant, hard-Right League party and the anti-establishment Five Star Movement ironed out their differences.
The prospect of Western Europe’s first populist, Eurosceptic government will unnerve Brussels and could lead to further turmoil on financial markets, not just in Europe but around the world.
Both parties are deeply Eurosceptic and have flirted with the idea of ditching the euro as Italy’s currency, although in the 24 hours before the breakthrough they had been at pains to deny that that was one of their objectives. ...
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