Both a "yes" or a "no" vote in Italy's referendum on constitutional reform this Sunday could equal a positive outcome for the country's populist Five Star Movement, one analyst argued on CNBC's Street Signs.
Weighing up the different options, "the yes vote is a harbinger of risk," Christopher Granville, managing director at Trusted Sources Lombard, said.
The reform proposes a situation in which the "lower house of parliament … can get outright power … in a centralized system, because local governments would be downgraded as well," Granville explained.
He added that this would be "paradoxical" for the Five Star Movement. While Prime Minister Matteo Renzi's power – which is wedded to the reform's acceptance by the Italian electorate – would be cemented, the country would establish "a system where a challenger … could win outright power in the Italian state and take Italy out of the euro."
The Five Star Movement advocates a "no" vote, upon which Renzi has vowed to step down from his role.
"I wonder if that's a short sighted tactic on their part," Granville suggested.