The report on macroeconomic imbalances issued by the European Commission on April 10 underlines Italy’s “loss of competitiveness as well as high public indebtedness” while warning that the weakness of its bank sector still poses a contagion risk.

However, financial markets do not seem to share the Commission’s worries, notes Corriere della Sera, pointing to a bond auction on the same day which raised €11bn, while the Milan stock exchange rose by 3 per cent.

Despite the political deadlock, the outgoing government of Mario Monti managed to pass an economic growth law, with the prime minister stating that “Italy’s public finances are back on a sustainable path.”