« Back to أخبار

Italy Has Built a Buffer to Shield Debt From Higher Rates

News & Data JIACC

Whatever the outcome of next month’s election, Italy’s bonds should be safe for a while yet

Source: Bloomberg – With a debt of 2.3 trillion euros ($2.8 trillion), or about 132 percent of the country’s yearly output, investors are well aware that Italy’s finances risk coming under pressure every time spreads widen, realistic prospect after a vote in March that will prove inconclusive at best. Further down the road, the European Central Bank’s exit from ultra-low rates is set to raise borrowing costs in coming years. Yet this is unlikely to rattle the euro area’s third largest economy in the short term. The country took advantage of the ECB’s 2.6 trillion-euro asset-purchase program to extend the average maturity of its bonds and reduce interest payments, making it less vulnerable to shifts in market conditions or sentiment.

To read the full article

® JIAC 2017 – C.F. 97866940584 - Credits