Italy bond yields fall further on plans to slash 4bn euro from budget

LONDON: Italian government bond yields extended their sharp falls on Wednesday, after a cabinet official raised hopes that the government could cut nearly four billion euros from its 2019 budget plans.

The government will revise its budget plans by next week, and may be able to save four billion euros from its pension and income support programme, cabinet undersecretary Giancarlo Giorgetti said.

Italy's two-year government bond yields were last down 11 basis points at 4-1/2 month low of 0.54 percent.

Italy's 10-year government bond yield dropped almost 10 basis points to 3.05 percent, a more than two-month low.