"I expect further cheapening of [Italian] bonds"
- Alessandro Giansanti, rate strategist at ING
Italian government bonds fell on Tuesday, pushing three-year and ten-year yields higher before an auction on Thursday, where Rome plans to sell 8.5 billion of debt, as investors are worried the euro zone's third-largest economy may lose access to financial markets.
"The 10-year is the area where Italy has to rely more on foreign investors and it will be very tough to sell especially at this point in the year, so I expect further cheapening of the bond going into the auction," ING rate strategist Alessandro Giansanti said.
"The three-year would be easier to sell, there is some demand from the domestic investors. If they see really weak demand in the 10-year ... they may sell more short-term [debt]."
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