Italian government bonds have been hit hard by the political risks that the new government may entail. That reports Business Insider.
The nomination of an unknown professor as new prime minister is causing the necessary shivers in the financial markets. Spreads in the eurozone have widened considerably. This causes Italy again to tensions in the financial markets.
New Prime Minister
The intention of the 'populist' parties (Five Star Movement and Lega Nord) to appoint little-known private law professor Giuseppe Conte as Italy's new prime minister has gone down on many investors. This is not only noticeable on the stock exchange in Milan, but also in the yields on government bonds, which have risen considerably.
According to Bloomberg, the effective yield on Italian 10-year government bonds has risen to 2,31%. On May 15, that was still 1,95%. The yield on the 10-year German Bunds, a key indicator of political stress in the eurozone, has since fallen to 0,56%.
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