{"id":36514,"date":"2018-08-07T08:23:15","date_gmt":"2018-08-07T13:23:15","guid":{"rendered":"http:\/\/olduvai.ca\/?p=36514"},"modified":"2018-08-07T08:23:15","modified_gmt":"2018-08-07T13:23:15","slug":"italian-bond-market-crisis-coming-up","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=36514","title":{"rendered":"Italian Bond Market Crisis Coming Up"},"content":{"rendered":"
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Italian Bond Market Crisis Coming Up<\/a><\/h3>\n<\/div>\n
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Italy’s 10-Year bond yield surged around the Italian election. There’s heavy issuance in Sept and ECB tapering in Oct.<\/p>\n<\/section>\n<\/div>\n<\/header>\n
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The yield on Italian bonds surged in May on the victory of the League- and Five Star in the national election. The alliance does not intend to follow EU budget rules.<\/p>\n<\/div>\n<\/div>\n<\/div>\n

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Heavy issuance is coming up in September. And in October, the ECB is scheduled to taper its QE bond purchases. This Combination of Events May Derail the Italian Bond Market<\/a>.<\/p>\n<\/div>\n<\/div>\n<\/div>\n

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Bankers lining up new company bonds in September may find that budget and spending discussions in Italy could derail what\u2019s usually the second-half\u2019s busiest issuance month. That\u2019s what happened in May, another typically busy month for sales, when the Italian election result triggered a government bond sell-off and issuance slump.<\/p>\n

\u201cIf we have something that resembles what we saw in May, the primary market should basically come to a halt,\u201d said Marco Stoeckle, a credit strategist at Commerzbank AG. \u201cIf we have the Italian government curve inverting, anything like that would be enough to significantly hamper issuance volumes. I guess the market would be closed.\u201d<\/em><\/p>\n

Last week, as Italian finance minister Giovanni Tria was said to begin a series of meetings to determine a draft budget, there were already signs of nerves, with 10-year yields breaking above three percent for the first time in nearly two months. Markets fear the nation may be headed for a collision course with European Union partners as the two parties in Italy\u2019s ruling coalition pledge to implement bold spending plans next year.<\/p>\n

On May 29, as BTP spreads lurched violently, borrowing costs for all of Europe\u2019s corporate borrowers rose: the Bloomberg Barclays index of corporate spreads widened 100 basis points in a single day — its largest jump in almost two years.<\/p><\/blockquote>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/article>\n","protected":false},"excerpt":{"rendered":"

Italian Bond Market Crisis Coming Up Italy’s 10-Year bond yield surged around the Italian election. There’s heavy issuance in Sept and ECB tapering in Oct. The yield on Italian bonds surged in May on the victory of the League- and Five Star in the national election. The alliance does not intend to follow EU budget […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[5185,233,282,1464,14648,13390,661,662],"class_list":["post-36514","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bond-market","tag-ecb","tag-european-central-bank","tag-italy","tag-michael-shedlock","tag-mishtalk","tag-qe","tag-quantitative-easing"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/36514","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=36514"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/36514\/revisions"}],"predecessor-version":[{"id":36515,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/36514\/revisions\/36515"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=36514"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=36514"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=36514"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}