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| - The latest salvo of stimulus aid fired off by the European Central Bank can help Italy, the worst-affected country by the coronavirus outside China, ECB chief Christine Lagarde said Thursday. "Italian banks, Italian households, enterprises will be fully beneficiaries and eligible to all of the tools that I have just mentioned," Lagarde said after announcing a slew of measures including increased bond purchases and cheap loans to banks. "All of that can also help Italy," said the ECB chief. But 10-year bonds of the EU's third biggest economy took a hammering after the ECB announced its package. The closely-watched spread between Italy's and Germany's bonds widened from 214 basis points before the session to 246 basis points as Lagarde closed her press conference. "But we are not here to close spreads," Lagarde said when asked if more targeted ECB action was necessary for Italy. With the entire country in lockdown over COVID-19, concerns are running high that Italy, which is already ailing under a mountain of debt amounting to 2.38 trillion euros ($2.65 trillion) or 134.8 percent of GDP, could spark a new economic crisis. With the debt volume equivalent to about a quarter of the eurozone's overall debt, an ailing Italy could represent a systemic risk to the single currency zone. Rome has announced a 25 billion euro package to rescue its economy, with part of the cash injection aimed at helping small businesses, many of whom are suffering the brunt of an implosion in the number of tourists visiting the country. hmn/mfp/jh
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