Italy readies economic rescue for families in virus crisis

Italy prepared Tuesday to allow families to suspend mortgage and some tax payments to help deal with a coronavirus outbreak that has killed 463 people and forced the government to restrict movement for its 60 million citizens.

Ministers said they would also ask the European Union to allow Rome to raise its deficit spending to 10 billion euros (USD 11.3 billion) to help businesses hurt by a precipitous drop in tourism over the past month.

The new family and small business support measures are expected to be formally unveiled in a government decree late Wednesday.

The Milan exchange lost an additional three percent on Tuesday after shedding 11 percent on Monday during a global market rout that was sparked by a collapse in the price of oil.

Analysts expressed concern that the measures could deliver a potentially fatal blow to Italy's wobbling banks.

Deputy Economy Minister Castelli said the family support measures could include "the suspension of the payment of (salary) withholdings and contributions" to various Italian tax funds.

Some banks expect Italy's economy to contract by 1.0 percent between April and June.

"We are worried about this and for this reason we pushed the banking system to give as much as possible (on the) suspension of mortgages," she said.

"You will see the details in the next few hours."