FRANKFURT (Reuters) – Italy’s euro-zone payments liabilities have climbed to a new record high.
The so-called Target debt of the Italian central bank rose by around 23 billion euros to 640.09 billion euros in July, according to data published by the Banca d’Italia on Friday. Within the euro zone, all of the banks’ cross-border payment transactions are processed via the “Target 2” clearing system. Italy began publishing its Target balances as early as 1997. These show the claims and liabilities that arise at the euro central banks in cross-border payment transactions. Italy was most recently the largest debtor in the system.
Economists follow the Target data closely. Because the numbers could hide changes in capital flows. That happened, for example, during the euro debt crisis a decade ago, when investors increasingly doubted the debt sustainability of Italy and other heavily indebted southern euro countries and parted with their government bonds. At that time there had been capital outflows from these countries. The Bundesbank is the largest creditor in the Target clearing system. Their Target claims fell in July by around 51 billion euros to 1.166 trillion euros.
(Report by Frank Siebelt, edited by Hans Busemann; if you have any questions, please contact our editorial team at [email protected] (for politics and economics) or [email protected] (for companies and markets).)