This is not a strictly Italian problem, it is common to the other countries of Europe. It lies at the origin of today’s fragility. European integration has brought price stability and, until the crisis, the effective control of public deficits.
This consideration was behind the decision to reduce the OCR in March so as to mitigate the near-term negative impact of the February earthquake. It is appropriate for monetary policy to remain supportive, given the continued downside risks to economic activity stemming from the Canterbury earthquakes and more broad fragility in the New Zealand economy.