Italy Now Troubles Bond Investors More Than Crisis-Ridden TurkeyBy
Political mayhem drove Italy’s credit risk higher on Tuesday than that of any emerging market tracked by Bloomberg -- including Turkey, itself in the midst of a crisis.
The cost of insuring Italy’s debt against default for five years using credit-default swaps soared as high as 276 basis points, overtaking Turkey, Brazil and South Africa -- three junk-rated countries that usually jostle for the title of most risky.
Europe’s second-most indebted nation is rated investment-grade by three major rating companies. But political and fiscal risks in Italy are rising, with pro- and anti-European forces at loggerheads in Rome and another election expected as early as September.