Italian Bonds Fall in Lackluster Debt Auction - Currency Trading Update

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by: fxsolutions
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Date: Thu, 29 Sep 2011 Time: 6:39 AM
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Joseph Trevisani, Chief Market Analyst at FX Solutions (http://www.fxsolutions.com/), provides forex traders with an overview of currency market activity on 14th September 2011, including news of a fall for Italian bonds.

"Yields on Italian debt rose to the highest level in two months earlier today despite the continued ECB purchase campaign to keep sovereign rates under control.

The Italian Treasury sold 3.9 billion euros ($5.3 billion) of new five year notes at an average yield of 5.60%, considerably above the 4.93% yield at the last auction of similar maturity notes in July. The Italian government had planned to sell up to 4 billion euros of this maturity. The auction was subscribed 1.28 times, much less than the previous auction's 1.93 multiple. Some dealers characterized the demand for this Italian paper as weak and uninspired.

The Italian 4.25% coupon two year note due in August 2013 closed at 4.542% in the secondary market, after having been as high at 4.724%, the highest in more than a month. The 10-year 4.75% coupon note due in September 2021 ended at 5.665%, having traded up to 5.749%. It was also the highest yield since early August."

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