Marcus Ashworth, Columnist

The Bond Market Is Not Impressed With Italy’s Budget

There’s nothing for bond investors to like in a 2.4 percent deficit target.

October 2, 2018 at 5:55 AM UTC

Marcus Ashworth is a Bloomberg Opinion columnist covering European markets. Previously, he was chief markets strategist for Haitong Securities in London.

You’ll love our budget. We promise.
Photographer: Giulio Napolitano/Bloomberg

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The bond market has voted on the Italian budget. It said no.

Officials agreed late Thursday on a 2019 deficit target of 2.4 percent, busting the 2 percent maximum that Finance Minister Giovanni Tria had said he’d accept. The government debt selloff that started on Friday continued on Monday, with 10-year yields soaring a total of 40 basis points to 3.3 percent. That’s close to levels reached in May, when the realization that Italy could be governed by a coalition of anti-establishment and anti-immigrant politicians sparked a panic.