Italian Prime Minister Mario Draghi has announced his resignation after the coalition party, the Five Star Movement refused to support him in a vote of confidence.
The former European Central Bank (ECB) president has led a unity government since February 2021 to help the economic recovery process from the Covid-19 pandemic.
However, Draghi decided to resign saying he no longer had the support of the ruling coalition.
Despite this, his resignation application was rejected by President Sergio Mattarela.
Following the announcement of his resignation, Italian 10 -year bond yields rose to a 3.5% high on Thursday and the safer German bond spread widened to 227 points ahead of the close of trading.
Draghi, nicknamed ‘Super Mario’ because of his long career as a financial problem solver admits to having seen Italy’s borrowing costs rise during his 17 -month tenure as prime minister.
The crisis facing Italy is big enough to bring down the entire edge of the European Zone because its government debt pile of 2.5 trillion euros is higher than the other four countries, and if combined, it is too big to be saved.
