Italy's bond yields tumble to new lows after 5-Star votes in favour of PD coalition

LONDON: Italy's bond yields fell to fresh lows in early Wednesday trade, after members of Italy's anti-establishment 5-Star Movement overwhelmingly backed a proposed coalition with the centre-left Democratic Party (PD).

Italy's 10-year bond yield fell 4 basis points to a fresh record low of 0.82%, while five-year bond yields lurched closer to 0%.

The results of the online ballot of 5-Star members, released late on Tuesday, opens the way for a new government to take office in the coming days.

Italy's closely-watched 10-year bond yield gap over safer German Bund yields tightened to around 149 bps -- its narrowest in more than a year.