MILAN (Reuters) - There will be no impact on public finances if Italians reject a referendum on constitutional reform on Sunday but there could be “48 hours of market turbulence”, Italy’s economy minister Pier Carlo Padoan told daily newspaper Avvenire on Friday.
Asked if a No vote would make it more difficult to achieve growth of 1 percent in 2017, making an extra budget necessary, Padoan said “no, I do not see any impact from a No vote on public finances.”
The minister said there was no risk of any “financial earthquake” from the vote even though markets could be unsettled for 48 hours.
“But then, as with Brexit, the fog will lift and normality will return,” he said.
Padoan said there was no systemic risk for Italian banks, adding financial analysts believed a No vote was priced in by the market, meaning a Yes vote could only be good news.
“Should there be a different scenario we will evaluate whether some kind of intervention is needed.”
Asked about troubled lender Banca Monte dei Paschi Padoan said it would return to being a “dynamic and competitive bank” after its planned capital increase.
Reporting by Stephen Jewkes