These days have arrived good and bad news. Let’s start with the good one: the spread has been at the minimum for 15 years. In some moments of today’s morning, June 13, the difference in performance between BTP and ten -year Bund went under 90 basis points. In the last 15 years, from 2010 to today, it had happened only twice and for a short time: in February 2021 (birth of the Draghi government) and in the spring of 2018 (on the occasion of the policies). And in reality the spread is even lower because at the moment it compares with a ten -year bund that expires six months before the nearest BTP (therefore it makes less). In addition, some authoritative forecasts, such as Barclays and Citigroup, estimate a spread up to 75 basis points. This would already be the case to celebrate the government action, which holds hard on a severe budgetary policy and never available to give in to the pressure pressures by various forces on the field, friends or enemies that they are. On the other hand, there is no shortage of topics in support: a few days after the failed referendums at work, Istat data The number of unemployed has decreased by 217 thousand units on an annual basis, corresponding to 11 percent. And unemployment remains stable at 6.1%, with an employment rate that almost 1 percent. There are 24,076,000 employees, an increase of 141 thousand units compared to the fourth quarter 2024. Furthermore, after 26 months of calm, industrial production returned to rise on an annual basis. In April an annual progress of 0.3%, which on a monthly basis becomes + 1 percent.
The bad one arrived yesterday, June 12, and concerns the damage caused by inflation. Who brought back a classic of the eighties: the fiscal drag. That phenomenon for which, in the presence of inflation, to income that increase for contractual renewals, shots or because it is indexed, does not correspond to an increase in purchasing power, which remains equal or less due to the increase in prices. (Example: if the indexed pension increases from 1,000 to 1,100 euros, and the coffee from 1 to 1.10, nothing changes for the pensioner). However – for the same progressiveness of the taxes (i.e. to unchanged brackets) – the highest income pay more taxes. So if with 1,000 euros I paid 100 euros of taxes, with the remaining I bought 900 coffee. But if today with 1,100 euros I have to pay 120 of taxes (the marginal rate has increased), I remain only 980 with which (at 1.10 euros) I buy only 891 coffee: therefore I lose 9 coffee, “drained” by inflation. For the government, of course, it is a deal (another reason why the spread falls): it is estimated that the Fiscal Drag has yielded 21 billion in 4 years.
What is the net result? Who prevails between good and bad news? In the short term I ugly. But in the long run, which is what really matters, the first prevails: the spread is the signal of a virtuous circle. Which, in fact, with inflation already in conspicuous drop, will soon begin to bear fruit in terms of recovery of purchasing power and, above all, in minor international pressures on the government’s economic policies. In other words, if we want, what hadn’t happened for some time.
That is, a slow but positive lightening of public debt costs from the shoulders of future generations. Of course, it doesn’t only depend on us, see wars and duties. But the government can do its part and we hope it will not come back.