BTPs, ten-year bonds and their yields. Here’s what changes for the Treasury
On the front of the Italian-German clash not only is the problem of migrants and the diametrically opposed versions between the two countries in terms of reception recorded, complete with a letter sent from Palazzo Chigi in Berlin to ask for explanations about the subsidies. But it’s also there a new “tear” in the spreadi.e. the differential of yield between Italian and German ten-year government bonds. The indicator – reports Il Fatto Quotidiano – it reaches 190 points, 6 more than yesterday. While a bund pays 2.79% (still at the highest since 2011), a Ten-year BTP offers 4.71%.
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The latter is the number to take into consideration since it translates into an increase in the interest that the Treasury will have to pay on the next issues and therefore in more or less marked stress on public accounts. The movement to increase in yields – continues Il Fatto – it has been affecting all European bonds for a few days. The prospect that central banks can maintain i rates at current levels for a prolonged period of time the interest on bonds already on the market to align with higher values. Since interest is fixed in absolute value but expressed as a percentage of the value of the security from which it derives, its increase it means the price of the bond is falling.
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