Diverging Politics Hurt Italian Bonds Relative to Spain: Chart

Two months before a referendum that may decide Prime Minister Matteo Renzi’s political fate, Italian 10-year bonds are yielding the most relative to Spain since 2014. Italy, Greece and Portugal are the only euro-area bond markets to lose investors money in the past month, while gains by Spanish bonds pushed 10-year yields to a record low, with that country’s politicians finally looking like they will form a government.

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