MILAN: Italy's benchmark 10-year debt costs fell to their lowest since August 2010 at auction on Thursday with large redemption flows feeding demand for its bonds amid buoyant investor sentiment towards weaker euro zone countries.
Italy paid a euro lifetime record low yield on the first tranche of a five-year bond.
It raised a total of 8.46 billion euro in bonds, near the top of its planned range, as analysts said improving fundamentals in the euro zone's periphery and expectations of further monetary easing in the bloc helped offset concerns about turmoil in emerging market currencies.
The new five-year bond, maturing in May 2019, fetched an average 2.43 percent yield, down from 2.71 percent at the previous sale of same-maturity debt in late December.
Demand rose from a month ago totalling nearly 1.5 times the 4 billion euros sold.
Italy sold 10-year debt at 3.81 percent, sharply down from 4.11 percent a month ago.
The bid-to-cover was broadly unchanged at around 1.3. It also sold a new tranche of a Nov. 2018 floating-rate bond, last issued in November, at an average 1.79 percent yield.
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