As the markets open, the tension on the Italian debt eases slightly. A few hours from new European agreement on the fiscal compact, reached yesterday late evening in Brussels, the Italian spread dropped by more than 10 points. After opening at 433, the yield differential between ten-year BTPs and the corresponding German Bunds soon fell to 417 basis points. At the same time, the yield on the Italian ten-year bond returned to the round figure of 6,0%.
Similar trend for the Spanish spread, which however still travels on figures well below the Italian ones: around 10 am the Madrid differential was at 318 basis points, after closing yesterday evening at 324. France, which has to pay for the uncertainties linked to the economic policy of Nicolas Sarkozy, now in full electoral campaign. The Paris spread is slightly up, at 124 basis points.
