The reassurances that Italy will stick to EU’s fiscal rules and and within the world’s largest trading bloc has been music to investors’ ears. No wonder Italian bond futures have risen this sharply.
On Monday, following Giovanni Tria’s, Italy’s Economy Minister, statement over the weekend, that the Italian government has plans to cut its debt levels and has no plans on leaving the European Union, Italian government bond futures rose sharply.
Investors had previously been rattled following statements by anti-establishment parties that they would boost spending levels and clash with the EU’s rules governing fiscal discipline. Tria’s comments have largely reassured them that the economy is on the right track.
The Italian BTP future, FBTPc1, a key metric for the bond market that is used by investors to hedge their exposure to Italian bonds, surged by more 150 ticks, in early trade to 124.18.