Tuesday, November 29, 2011

Italy's Autions: Still Paying Above 7%; Huge Jumps in Yields Again

We commented on the massive amounts of auctions coming up for Italy. The situation has not gotten any better in spite of all the recent "Europe has been saved" news, and the ECB apparently buying their bonds to keep yields low.

3.5 billion euros of a new three-year bond were sold, 2.5 billion euros of 2022 bonds and 1.5 billion euros in 2020 bonds, a little short of the top range of 8 billion euros for the sale. The three-year bond yield were 7.89% percent while the 2022 bond yielded 7.56%, up from the previous 4.93% (!). and 6.06% on Oct. 28..
Bloomberg: The ECB started buying Italian debt on Aug. 8 to "tame borrowing costs after the 10-year yield had surged to euro-era record of 6.4 percent. After falling to under 5 percent around mid-August, the yield resumed rising and reached a new record of 7.48 percent on November".

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