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Yield on 10-year Italian bond lowest since 2006

Drop follows successful one-year BOT auction

12 February, 11:52
Yield on 10-year Italian bond lowest since 2006 (ANSA) - Rome, February 12 - The yield on the 10-year BTP Italian State bond dropped to its lowest level in eight years on Wednesday. The yield on the 10-year bond fell to 3.67%, the lowest since February 23, 2006. The spread between the 10-year BTP and the German equivalent, a key indicator of investor confidence and of Italy's borrowing costs, came down to 197 basis points.

The spread went over 500 points with yields of above 7%, levels considered unsustainable in the long term, when Italy risked a Greek-style financial meltdown at the peak of the eurozone debt crisis in 2011.

Wednesday's fall in the 10-year bond yield came after a successful Treasury auction of one-year BOT bonds.

The Treasury sold eight billion euros' worth of BOTs at an average interest rate of 0.676%, an all-time low and down from 0.735% at a sale in January.