Evidently the sunburn from inflation it's still burning and, although prices are falling quickly, to 2,6% in February in the euro area, many fear that the cost of living could remain high for a long time, if not even start to grow again. So even a gross yield of 1,83% for a bond maturing in 2036 is to be considered interesting.
This explains the enormous demand received for the new one Indexed BTP to the inflation of the euro area: 41 billion the highest request ever at continental level for a security linked to inflation. The Treasury then placed "only" 5 billion at the price of 99,763 (ISIN code: IT0005588881) with an indexation coefficient indicated at 0,99524. The actual half-yearly coupons will obviously depend on community inflation, net of tobacco. The syndicated placement was managed by Banco Bilbao, BofA, Citibank, HSBC and Société Générale in the role of lead managers.
The subscribers to the Italian Treasury's offer were mainly international investors, who according to initial estimates absorbed 80% of the purchases, with a prevalence of Asia, France, the United Kingdom and the Iberian peninsula.
Treasury has already raised about a third of the 2024 program
It's a new success for the Treasury, no doubt about it, which has always received impressive demand volumes since the beginning of the year. Via XX Settembre travels now around 30% of the demanding annual program, i.e. approximately 8 points above last year's pace. The success of the is still fresh Btp Value March 2030 which saw over 18 billion euros raised, a record figure for a retail title. At the end of January, Reuters recalls, Via XX Settembre had placed a new 15-year BTP worth 10 billion euros with orders almost eight times the amount, while at the beginning of the year the demand for a dual tranche - a new 7-year bond worth 10 billion and the reopening of the thirty-year period for 5 billion - had overall exceeded the 160 billion mark.
The appeal of Italian BTPs compared to European competitors
Indeed at this moment the and to investors they see i positively Italian BTPs and they see the country risk (2.848,7 billion public debt in January) limited thanks to the ECB's measures (the Tpi, Transmission Protection Instrument, introduced in July 2022 and never used) to reduce the spread, if necessary.
After all, Italian titles offer a slight edge over their European competitors. Taking the ten-year benchmark as a reference, yesterday the BTP closed with a yield of 3,7%, against the 3,3% of the Greek counterpart, the 3,24% of the Spanish Bonos, the 2,88% of the French Oat. Compared to the German Bund, the spread closed at 125 points. The 2024 path for the Treasury continues to be challenging, aiming for a collection that reaches 340-360 billion in the medium-long term alone.
Future inflation: expectations scaled down
On the expectations side of inflation after all, the latest data Usa they have somewhat scaled back their expectations for a cooling of prices Europeans, giving some fuel to the indexed stock. Markets are pricing in the start of rate cuts by the ECB starting in June. Vice President Luis De Guindos pointed out that Frankfurt "depends on data and not on dates".
