Fund managers have warned of short-term volatility following Italy's vote against constitutional reform in this weekend's referendum, which they say could "exert a baleful influence" on the country's struggling banking sector.
The euro fell to levels last seen in March 2015 last night as Italian Prime Minister Matteo Renzi said he would resign after suffering a worse defeat than expected in the country's referendum on constitutional reform.
For over two decades, the pace of Italy's economic growth has lagged that of its major continental peers, writes LGIM's Justin Onuekwusi.
Amid widely-held short positions in Italian debt
Investors are taking a cautious approach to the upcoming Italian referendum on constitutional reform, but say the market consequences of the vote will not be as serious as the Brexit vote or US election, whatever the outcome.
Amid 2017 European election uncertainty