Italy Has a Golden Opportunity in the Bond Market
With a new euro-friendly coalition in place, Rome could issue more long-term debt. That would show Brussels it has the investor stamp of approval.
Make hay while the sun shines.
Photographer: ANDREAS SOLARO/AFPThe new Italian government coalition of the Democratic Party and the Five Star Movement has been gifted a golden opportunity. The sharp drop in its sovereign bond yields means it can get ahead of its borrowing requirements for this year.
Italian yields have fallen to record lows recently as investors have welcomed an administration that’s somewhat less antagonistic to the euro zone than the previous one dominated by Matteo Salvini and his far-right League party. Yet everything is relative in a world of negative interest rates and Rome’s debt has been a serial under-performer when compared to its European peers. It’s time to catch up.