Quitting euro no answer to Italy’s woes, central bank chief says

ROME (Reuters) – Leaving the euro zone would not help Italy solve its economic problems and the country should use a modest economic recovery to fix its public finances and cut debt, the head of its central bank said on Wednesday.
Bank of Italy Governor Ignazio Visco took aim at eurosceptic political parties who blame Italy’s chronically slow growth on the constraints of euro zone fiscal rules and suggest leaving the single currency.
“It is an illusion to think that Italy’s economic problems could be solved more readily outside Economic and Monetary Union,” Visco said in a speech to the Bank of Italy’s annual assembly.
The right-wing Northern League wants to pull Italy out of the euro zone and the anti-establishment 5-Star Movement, which some opinion polls say is the most popular party, wants to hold a referendum on the issue.
Elections are due within a year and may come as soon as this autumn.
Visco said Italy must focus its energies on bringing down the huge public debt which is “a serious source of vulnerability which weighs on the country’s economy.”
The debt, at around 132 percent of gross domestic product, is the highest in the euro zone after Greece’s.

(Reporting By Gavin Jones)