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Italian Bond Rally Hits a Hurdle as Election Uncertainty Grows

  • Move is knee-jerk reaction to caution over a vote, Mizuho says
  • There are ‘willing profit takers’ after rally: Mediolanum
Matteo Salvini

Matteo Salvini

Photographer: Akos Stiller/Bloomberg
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This week’s rally in Italian bonds has come to a halt on uncertainty over whether the country is heading for an election.

Benchmark 10-year yields jumped Friday, after falling to a three-year low Thursday, on a report that Deputy Prime Minister Matteo Salvini hadn’t decided whether to hold a snap election. The securities are still on their longest-winning weekly streak in five years as investors bet on monetary policy easing by the European Central Bank.