Spread alarm is again across Europe. The spread between the government bonds of the main European countries and the German Bunds is increasing almost everywhere, following the tensions raised by the fears about Spain. In Italy the difference between the BTP and the Bund has increased again and hit 340 points with a 5,2-year bond yield at XNUMX%. Yet theTreasury auction went well this morning: the State placed 3,25 billion 2022-year Btp maturing in September 5,24, with a rate down to 5,50% from XNUMX% at the auction a month ago.
For sure the positive data on German unemployment, at historic lows, helped widen the gap, but the German Bund dropped from 1,86% this morning to 1,81 by mid-day, too small a drop to explain the effect on European spreads.
In Spain the Bonos/Bund differential reached 362 points, a figure not seen since the beginning of the year. Also in France the spread widened to 114 bps. It is no less the Portugal where Bonos scores 946 points of difference with the Bund, up from the 942 opening.
