MILAN: Italy sold the top planned amount of 7.5 billion euros ($8.8 billion) at a bond auction on Monday as support provided by the European Central Bank's pledge of a very gradual policy tightening countered investor concerns over the next budget law.
Italy has trimmed the size of its debt sales recently, in the face of market turmoil as a new anti-establishment government came to power.
The launch of a new 10-year bond, however, meant that Monday's auction was slightly larger than recent sales, but it met with good demand thanks also to large redemptions this week.
The new bond fetched a gross 2.87 percent yield, up from the 2.77 percent Italy paid a month ago on the previous 10-year benchmark. The new bond matures in December 2018 compared with the February 2018 maturity of the previous benchmark.
The 10-year sale drew bids equivalent to 1.42 times the 4 billion euros sold compared with a bid-to-cover of 1.26 times at the previous, smaller auction.
Italy also sold a new tranche of its March 2023 five-year benchmark at 1.80 percent, little changed from 1.82 percent at the previous end-June auction.
Demand strengthened with a bid-to-cover of 1.47 times versus 1.34 times then.
The Rome-based Treasury also sold a floating-rate bond maturing in September 2025 at 1.75 percent compared with 1.67 percent a month ago.
Comments
Comments are closed for this article.