Italy could create further market volatility on Thursday, as the government presents its new budget targets for the next three years.
Markets have been nervous about new spending plans in Italy, following a general election that led to a populist government.
The coalition — formed by the right-wing League and the leftist Five Star Movement — has promised to implement a universal citizens' income, reduce taxes, review an unpopular pension reform and promised to stop a VAT increase scheduled to start in January 2019. According to UBS analysts, these measures could cost up to between 4.5 and 7 percent of Italy's total gross domestic product (GDP).
The higher spending could be a problem for Italy, given its large public debt. Rome has the second biggest debt pile in Europe, at 130 percent of GDP.