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Italy Borrowing Costs Drop at Sale as Spanish Crisis Deepens

Italy’s borrowing costs dropped at an auction of five- and 10-year bonds, indicating investors view the country as a safer bet than Spain, where yesterday 10-year bond yields climbed the most this month as anti-austerity protests turned violent.

Italy sold 6.65 billion euros ($8.55 billion) of five- and 10-year bonds today, almost matching the 7 billion-euro maximum target. The Rome-based Treasury priced a 10-year bond to yield 5.24 percent, down from 5.82 percent when a similar-maturity bond was sold on Aug. 30, and it’s the lowest Italy paid to borrow for 10 years since March 29.