Standard & Poor's, next 26, and at the end of the month Moody's, they will give theirs judgment on Italy, after having awaited guidelines for the economic maneuver. Both see backtracking on public finances as a risk. Both Moody's, which already expressed a negative outlook, and S&P - which just a year ago had raised its rating -, writes Fabrizio Massaro in Corriere della Sera, still have opinions "investment grade»(Baa2 and BBB). If they lowered the judgment by just one level, Italy would remain in the group of the most reliable debtors.
The worst situation would be the downgrading of two levels, making Italy slide into the "speculative" zone, known as "junk". For this reason, the Conte government would have slowed down on the deficit, forecasting it at 2,4% only for 2019. Fitch has already expressed its opinion on 31 August confirming the BBB but with "negative" prospects given the impact of the higher deficit expected. The July 13 Instead, the Canadian Dbrs (with three levels above the "junk" grade) had pronounced itself, this time giving credit to the government and to the strength of the Italian economy. Italy must be kept in the investment zone by at least one agency to give the ECB the opportunity to buy BTPs. Only in this way would Italian banks have easy access to liquidity. A rejection would make the spread fly by making Italy slide towards the financial abyss, the commissioner and the possible intervention of the feared Troika.
What is the Troika
In the context of EU economic policy the term troika, from the Russian тройка (transl: triplet) refers to all official creditors during negotiations with countries, as defined by the portal of the European Parliament.
Specifically, the triplet, rather than individuals, consists of institutions: the European Commission, the European Central Bank and the International Monetary Fund, each with its own representatives.
The Troika is in charge of drafting and enforcing bailout plans in eurozone countries in great difficulty due to public debt and thus avoiding their default. Usually these are projects with a high austerity rate for the countries affected by the Troika's interventions, but, on the other hand, the austerity required is the only way they have to obtain loans that allow them to exit the crisis.
The interventions and economic policies requested and enforced on behalf of the Troika never pass without triggering controversy and, often, there are also street clashes with accusations of undemocratic attitudes by the Troika itself. In this regard, an investigation by the European Parliament has been active since January 2014 to verify the transparency and level of democracy of the interventions proposed and implemented.