How Does the Italian Referendum Affect Me?

The Italian referendum and Austrian presidential election are the latest events in a year of unexpected results and political turmoil

Dan Kemp 6 December, 2016 | 4:33PM
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The Italian people have voted to reject a package of democratic reform measures proposed by Prime Minister Mateo Renzi. Mr Renzi has resigned following the result, triggering a period of political uncertainty in the EU’s fourth largest economy. What does this mean for investors? In these talking points, we’ll review the situation and its effect on investment markets.

The Italian referendum and Austrian presidential election are the latest events in a year of unexpected results and political turmoil. The referendum result is likely to dominate news flow over the next few days and therefore we thought it would be useful to provide investors with our perspective on the impact of the vote, the outlook for markets and the response of our investment team.

Before considering the implications of the Italian vote, it is worth reviewing the facts of the referendum. This vote was intended to bring structural reform to the Italian political system and in doing so, facilitate economic policies designed to boost the growth of the Italian economy. While there appears little disagreement that reform is necessary in an economy that has shrunk over the last eight years, these reforms were opposed by the populist ‘Five Star Movement’ and the Northern League.

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About Author

Dan Kemp

Dan Kemp  is Chief Investment Officer, Morningstar Investment Management EMEA

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