Italy has become a source of insecurity for the European Union once again. Previously there were tensions as preliminary elections had to be called in March. Those produced no clear majority and the two leading parties, both eurosceptics, The League and the Five-Star Movement failed to reach an agreement to form a coalition.
Initially the euro received a boost on this news, as a eurosceptic government could add to worries of Italy possibly leaving the EU. However, now the President of Italy is set to appoint an interim government to prepare the country for another round of elections.
Currently the tentative date for new elections proposed is July 29, though some politicians have expressed concerns that the time might be inconvenient for Italian voters who work abroad during the summer.
It is expected that even if Italy holds a new round of elections, the results would be similar, and the Five-Star Movement and the League would again have to discuss a coalition, and would likely be more successful at reaching an agreement on the second try. A eurosceptic government in Italy would further pressure the euro.
