BELGIUM: ITALY EXPECT TO FORCE THE ITALIAN LIRA BACK INTO THE EUROPEAN EXCHANGE MECHANISM AT EUROPEAN UNION...
- Title: BELGIUM: ITALY EXPECT TO FORCE THE ITALIAN LIRA BACK INTO THE EUROPEAN EXCHANGE MECHANISM AT EUROPEAN UNION FINANCE MEETING
- Date: 24th November 1996
- Summary: BRUSSELS, BELGIUM (NOVEMBER 24, 1996) (RTV - ACCESS ALL) 1. SLV EXTERIOR CONFERENCE CENTRE/ EU FLAG 0.11 2. SLV ITALIAN TREASURY MINISTER PAOLO AZEGLIO CIAMPI ARRIVING 0.28 3. SLV EUROPEAN COMMISSIONER YVES DE SILGUY ARRIVING 0.37 4. SLV BANK OF ENGLAND GOVERNOR EDDIE GEORGE ARRIVING 0.52 5. MV GOVERNOR OF CENTRAL BANK OF SWEDEN ERBEN BACKSTROM GETS OUT OF CAR 1.08 6. SLV HEAD OF EUROPEAN MONETARY INSTITUTE ALEXANDER LANSALUSSY ARRIVING 1.07 7. SLV LUXEMBURG PRIME MINISTER AND FINANCE MINISTER JEAN CLAUDE JUNCKER ARRIVING, SAYS HE'S NOT PESSIMISTIC (FRENCH) 1.27 8. SLV AUSTRIAN CHANCELLOR FRANZ VRANTZKY ARRIVING 1.31 9. SLV SPANISH FINANCE MINISTER RODRIGO RATO ARRIVING, SAYS HE HOPES FOR A SOLUTION (ENGLISH) 1.36 10. SLV MORE ARRIVALS 1.48 Initials Script is copyright Reuters Limited. All rights reserved.
- Reuters ID: LVA6NQEHE7HDTTFWUAI5PAMCNYSI
- Location: BRUSSELS, BELGIUM
- Country: Belgium
- Duration: 00:01:48
- Story Text: INTRO: - Italy was expected to fight tooth and nail to force the lira back into the European exchange rate mechanism at a central rate no stronger than the magic level of 1,000 to the German mark, analysts said on Sunday.
European Union finance ministers met in Brussels on Sunday (November 24) to try to break a deadlock after a monetary committee of central bank and treasury officials failed to agree on what terms the lira should be let back into the currency grid.
But one outcome the Italians cannot contemplate is no agreement at all -- which could expose the lira to a battering on foreign exchange markets -- and its negotiators may have to swallow their pride and settle for less, economists said.
"There is no real economic justification for taking the lira in at a rate stronger than 1,000 lire and it could slow down the process of bringing down interest rates in Italy," Mario Noera, an economist at Deutsche Bank in Milan.
"But I don't think Italy can afford to walk way with no agreement at all," said Noera.
Italy sees re-entering the ERM, from which the lira made an ignominious exit in 1992, as crucial to keeping alive its hopes of joining an advance guard of European countries in a currency of joining an advance guard of European countries in a currency union in 1999.
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