Don’t Be Complacent About Italy’s Elections

Calm before the storm?

Photographer: Carlo Hermann/AFP/Getty Images)

Investors contemplating Italy's upcoming elections apparently see no cause for alarm, but their mood may not last. The vote looks set to produce a coalition government too weak to address the country's twin challenges of slow growth and high debt.

QuickTake Italy's Elections

For now, calm prevails. The country's 10-year bond yield, which rose to more than than 7 percent during Europe's economic crisis, hovers around 2 percent. Italy's equity market has been battered by the recent global setback, but it's still outperforming its European peers.

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