The spread between Italy's
10-year BTP bond and the German Bund closed down 11 points on
233 basis points on Tuesday, with the yield on the BTP down
0.04% to 2.87%.
The spread closed on 244 points on Monday.
The financial markets are paying attention to negotiations
within the government on the budget and reports that a
compromise could be reached that would see the deficit-to-GDP
ratio kept under the 2% threshold.
The spread is a gauge of investor confidence in Italian
debt.
The lower the spread is, the better it is for the Italian
economy and debt-servicing costs.
The spread rose above 300 points in May amid fears of a
possible Euroskeptic government forming in Italy.
The new government has stressed it does not want to leave the
euro.
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