ITALY HAS SEEN its cost of borrowing fall dramatically this morning, as it successfully raised €6 billion in a new bond auction.
The country’s treasury this morning sold €4 billion in bonds maturing in November 2014, with an average interest rate of 3.41 per cent.
That yield is down significantly on the 4.83 per cent commanded when similar bonds were sold only a month ago.
Alongside the benchmark loans, Italy also raised €2 billion in bonds due in 2015 and 2017, at yields of 3.77 and 4.26 per cent respectively.
The lower borrowing costs come despite the downgrade of Italian bonds by Moody’s, which cut Italy’s rating by one notch last night.