Italy reported to tell EU that it will go forward with current budget plan

According to a report by Repubblica

The report says that Italy will send the response to the EU's letter on the budget later at 1155 local time (0955 GMT). It was reported earlier in the day that Italy will respond to the letter today but it looks like nothing is going to change their mind.

The EU will have up until 29 October to reject Italy's proposal - which they likely will at this point. And with that, we could be in for a long back-and-forth debacle between the two over the coming month.

Despite all of this, watch out for a possibly improved sentiment in Italian bonds later in the day with Moody's having downgraded Italy's credit rating to one grade above junk status last week but revising the outlook to stable, implying that a possible downgrade to junk status is very unlikely.