Yields on 10-year Italian bonds fell below 5.0 percent for the first time since mid-August on Thursday in a sign of investor confidence on the secondary bond market after the ECB pumped hundreds of billions of euros to banks. In mid-day trading, the yield on Italy's benchmark bonds fell to 4.974 percent from 5.174 percent late on Wednesday.
Italian benchmark rates had progressed above the 5.0 percent mark since August peaking at 7.5 percent in mid-November when fears of a default by Italy reached their peak. Italy's 1.9-trillion-euro debt mountain is the biggest in Europe. The falling yields comes a day after another massive liquidity boost by the European Central Bank, this time worth nearly 530 billion euros ($730 billion) after one in December helped ease pressure on weaker eurozone member states' borrowing costs. According to the Bank of Italy, Italian lenders received 139 billion euros in the second operation. Spain meanwhile raised 4.5 billion euros in an official sale of long-term bonds on Thursday, securing lower repayment rates in a market flush with the new loans from the ECB.
It sold bonds of two, three and five years' maturity for a total of 4.501 billion euros, fulfilling its target amid high demand, the Bank of Spain said in a statement.
Comments
Comments are closed for this article.