Analysts at Danske Bank point out that yesterday was another tough day for Italy in the bond market.
Key Quotes
“While we are still awaiting the official document with the underlying assumptions behind the government’s 2.4% deficit plan, Deputy VP Di Maio confirmed the already announced 2.4% deficit. The 2Y Italian yield rose yet again by almost 20bp and is often used as a gauge as a debt restructuring measure.”
“The 10Y yield rose to a four-year high. Overnight, Italian newspaper Corriere reported that the deficit would be cut to 2% in 2021, which could mean slight market support this morning in a volatile session. We are still awaiting the technical document, including the assumptions behind the headline deficit.”