A large devaluation of the euro 1.5% to a 20-month low

Sunday (4th) Italy constitutional referendum results were announced, against a strong majority, Matteo Renzi, Prime Minister immediately announced Monday (5th) will resign to step down. Euro immediately plunged at the news of more than 1.5%, almost US $1.050 points, hit a 20-month low, and the distance closer to parity with the dollar.

However, the experts said, it doesn't mean that Italy is out of the EU, and market prices is partially reflect the results today. 7:22 Taipei time Monday, the euro had tipped off 1.5% at $1.0506, lowest since March 16, and its biggest one-day drop since June this year, fear of falling price $1.0457 test in March last year the bottom.

Against 15 of the 16 major rival currencies fell against the safe-haven Yen reduced more 1.88% at 118.77 yen.

This Expected on Monday Italy bonds under heavy selling pressure, with the United States, and Germany bond yield spreads could expand further. Investors and political concerns in Europe and Italy in a referendum not to stir up political unrest, and Italy banks in trouble again, and then to a new crisis in the eurozone.

Debt of the last 6 months in the eurozone last 10 bond and the German bond spreads last Monday (28th) go on a 17-month high.

However, as the market has considerable expectations before the referendum does not pass, so the initial reaction in currency markets is relatively less strenuous, the yen rose against the dollar to 0.6% at 112.88 yen, later dropped back to 113.85 yen. Barclays Fabio Fois, an analyst in London for Bloomberg, said that although the referendum did not have, could threaten Italy continued to remain the euro zone; but the political and legal system of the country still do not allow this result to start the quick exit. "The Chamber will continue to exist, what's really important is the attitude of the Government to continue to push forward the reform.

」 Exit not only the consultation procedure time-consuming, complex, and even Italy Renzi to step down ahead of congressional elections, anti-EU party of the five-star access regime also depends on changes in the electoral system.

Italy international politics Institute (ISPI) Antonio Villafranca, an analyst pointed out that in Europe, even five-star party wins the election, will continue to face difficulties in finding enough allies to form a parliamentary majority power. In addition, Italy the constitutional referendum are still prohibited from termination of international agreement, ruoyi Government and seeking a referendum to decide whether the European Union, must also face obstacles to amending the Constitution.

Finally, the poll, published on 21st last month, supported the exit of Italy people compared to just 15.2% and up to 67.4% of the public still supports the single European currency. However, JPMorgan Chase analysts warned that as long as Italy's political exit forces gained the upper hand, is enough to set off shocks. "The exit of any strong talk, may raise money fled, markets have gyrated; however, market pressures may force supported the exit of Italy political party quickly changes course."