JOIN USItaly’s Silvio Berlusconi on Tuesday set the tone for his election campaign saying nobody should care about bond spreads, and accusing Mario Monti of being “German-centric” as the prime minister said he had spared Italy from the same fate as Greece.
“Who cares about the spread?” the 76-year-old Berlusconi, who is running for the sixth time in two decades, said in an interview with Canale 5 television -- part of his media empire.
“The spread is a trick and an invention with which they tried to bring down the majority that ruled this country,” said the three-time prime minister and billionaire, referring to his last government which collapsed in November 2011 following a parliamentary revolt and panic on the markets.
The spread is the differential between Italian and benchmark German 10-year sovereign bonds -- a closely-watched measure of investor confidence. The spread had narrowed to below 300 points last week but has widened since Berlusconi’s People of Freedom party said on Tuesday that it was withdrawing its support for Monti's government.
Berlusconi then announced he would run for prime minister and Monti said he would resign as soon as parliament approves next year’s budget, bringing forward the likely date for elections to February.
There is growing speculation that Monti will also decide to run in the election although he has so far declined to comment, saying only that he is not considering the option “at this stage”. The spread was around 349 points on Tuesday, while the stock market inched up 0.64 per cent in afternoon trading -- a day after it trailed other European bourses reacting to the weekend of political drama and the re-emergence of Berlusconi.
Polls say the favourite to win is centre-left leader Pier Luigi Bersani, a cigar-chomping former communist and two-time minister who spearheaded a liberalisation drive when he was in office.
Berlusconi on Tuesday also criticised Monti as “too German-centric”.