Italy 5-Year Yield Tops 7.5% on LCH Charge as Berlusconi Quits
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Italian bonds slumped, driving two-, five-, 10- and 30-year yields to euro-era records, after LCH Clearnet increased the deposit it demands for trading the nation’s securities.
Five-year yields climbed above 7.5 percent as Prime Minister Silvio Berlusconi’s offer to resign left his weakened government struggling to implement austerity measures to reduce borrowing costs. German 10-year bunds outperformed all their regional peers as the drop in Italian bonds boosted demand for the safest fixed-income assets. The euro sank and U.S. Treasuries jumped.