11/9/2018, 10:25 AM (Source: TeleTrader)
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Italy's yields rise as budget dispute escalates

Bonds issued by the government in Rome were hit by a selloff on Friday together with Italian stocks in a global swing to risk aversion in the markets. Giovanni Tria, minister of economy and finances, stated the narrowing of the rate of economic growth is in line with the rest of the European Union.

Lawmaker Claudio Borghi continued with the aggressive rhetoric heard from Prime Minister Giuseppe Conte and members of his cabinet. The chief of budgetary affairs in the country's parliament claimed the European Commission used fake data in the assessment of Italy's spending plan and asserted it is possible the administration in Brussels won't have the "courage" to introduce sanctions. The moves in debt securities, which translate to a jump in yields, were helped by the United States Federal Reserve's intentions to keep pushing interest rates higher and widen the gap with central banks of the United Kingdom, the Eurozone and Japan.

Policymakers in Washington also warned of a deceleration in business expenditure and investors turned to safer assets. Italy's two-year yield spiked 4.9 basis points to 1.006% at 10:24 am CET. The measure of the 10-year debt securities surged 4.5 points to 3.445%, compared to the increase of 2.7 points to 3.986% for the 30-year bond.

Breaking the News / IT