The good trend for Italy’s debt continues. Also this morning the yields of government bonds of our country moved down, in line with the government bonds of other European countries. In particular, today’s auction of 7 billion euro half-yearly bots reached new historical lows, reaching -0.524%, from -0.521% of the previous placement.
In the meantime, the BTP / Bund spread moves around 106 basis points while the ten-year BTP yield is stable at 0.62% (-1 basis point).
There is expectation for tomorrow’s medium-long term auction where 8.75 billion of the new 5-year BTP (August 2026), the 10-year BTP and the Ccteu April 2029 will be offered.
The market remains strong despite the focus on the two-day meeting of the Federal Reserve, the American Central Bank, which has been scheduled since yesterday. The meeting should continue discussions on the start of tapering, that is to say the gradual reduction of monetary stimuli by the US institute. This is a path that could anticipate a similar move also by the European Central Bank (ECB).
Concerns remain in the background about the risks for the economic recovery linked to the spread of the Delta variant of Covid-19, in addition to fears about the acceleration of inflation.
Meanwhile, good news arrived yesterday from the IMF. The International Monetary Fund has raised the Italian growth estimates for both this year and the next with an improvement in public accounts for 2021 as well. In the update to the “World economic outlook”, the Washington-based body has revised upwards the estimates for Italian GDP in 2021, bringing them to + 4.9% from the + 4.3% assumed in June. Similar revision also for the 2022 GDP, which rose to + 4.2% from the previous + 4%.
On the public accounts front, an improvement is estimated with the forecasts for this year’s deficit / GDP ratio, which went to 11.1% from 11.8% in June and that debt / GDP dropped to 157.8% from 159.9 %.