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Friday, February 3, 2023

Draghi’s continuity relieves the Italian Confederation



The possibility that Mario Draghi will continue to lead the Italian government has eased pressure on the transalpine debt, with the required yield on Italy’s 10-year bond falling to a one-week low.

The yield on the Italian ten-year bond fell to 3.269% this Wednesday, the lowest yield since last Thursday, after exceeding 3.5% amid the open political crisis in the government these days and which led to Mario Draghi’s resignation submit as prime minister.

As a result, the risk premium that Italian 10-year bonds were offering investors over the German Bund narrowed to just over 200 basis points, after hitting 230 late last week.

Italy’s Prime Minister Mario Draghi, who tendered his resignation last week after the 5-Star Movement failed to appear in the Senate confidence vote, has shown this Wednesday that he is prepared to remain in office should problems arise are resolved disputes within the governing coalition.

“A firm and coherent government is necessary. Italy needs a concrete and sincere development pact,” said Draghi, who has asked Parliament for “support” for the executive and “mutual respect” for the role of each of them. “Italy does not need a façade of confidence that fades when untimely action is taken,” he said.

In addition to the possible resolution of the political crisis in Italy, the relaxation of the pressure on the Italian debt is also due to the expectation regarding the meeting of the European Central Bank (ECB) this Thursday, in which the company will carry out its first increase in interest rates since 2011 and may offer details on its new tool to combat credit market fragmentation.


Source europapress.es

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