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Euro zone is stable, Italians are pro-European - German Finance Minister

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Euro zone is stable, Italians are pro-European - German Finance Minister
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By Michael Nienaber and Gernot Heller

BERLIN (Reuters) – German Finance Minister Olaf Scholz said he is firmly convinced a majority of Italians have “a very pro-European stance”, and that the euro zone is stable and has become better prepared for difficult situations in recent years.

Asked about developments in Italy, where a political crisis has spooked financial markets, Scholz told Reuters that euro zone countries had worked hard in recent years to make the bloc more stable.

“The European Union is very stable, the euro zone too,” he said in an interview on Wednesday.

“One can say that Europe is better prepared for difficult situations than before. What is more, I am firmly convinced that the majority of Italians have a very pro-European stance. It is a European nation.”

A political crisis in Italy, where two anti-establishment parties came close to forming a ruling coalition after an inconclusive election in March, has unsettled financial markets.

Asked about whether he was worried about market turmoil, Scholz said: “Europe is currently in good economic condition.”


On the euro, he added: “What we have seen over the last few years is that the euro is a stable currency and when one speculates against this currency it’s totally unreasonable. There are of course ups and downs, but there is no need for further debate.”

The 5-Star Movement and the right-wing League abandoned their bid to take power in coalition after President Sergio Mattarella vetoed their choice of 81-year-old eurosceptic Paolo Savona as economy minister.

Italy faces the risk of a drawn-out political crisis with a possible new election later this year, which could amount to a referendum on the euro in the single currency bloc’s third-largest economy.

Scholz also dismissed concerns about the exposure of Deutsche Bank <DBKGn.DE>, Germany’s largest lender, to Italian bonds.

“Deutsche Bank is very stable and over the last few years it has taken good precautions so that its business can develop reasonably,” he said.

(Writing by Paul Carrel and Joseph Nasr; Editing by Catherine Evans)

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