Tuesday, November 21, 2017
 
 
News: Page (1) of 1 - 07/14/11 Email this story to a friend. email article Print this page (Article printing at MyDmn.com).print page facebook
Italian borrowing costs jump before austerity vote
Italian borrowing rates spike in bond sale ahead of Senate vote on key austerity package
By The Associated Press

MILAN (AP) ' Italy's borrowing costs jumped higher in a bond sale Thursday, only hours before the Senate was due to vote through an austerity package that is key to convincing investors the eurozone's third-largest economy will not be dragged into the debt crisis.

Italy raised euro4.96 billion ($7 billion) by selling 5- to 15-year bonds, but investors demanded sharply higher interest rates, a sign of increased concerns about the country's financial future.

Yields on the 5-year bonds hit 5.9 percent, the highest for that debt since the launch of the euro and up from 3.9 percent at the last such auction in June. The 15-year bond yields hit 4.93 percent, the highest since June 2008.



Italian stocks and bonds, which were buoyed in the early morning on the prospect of the Senate vote, slumped after the sale.

Finance Minister Giulio said the austerity package contains 16 measures to spur growth. He has pledged that the measures to balance the budget by 2014 will be passed in both houses by Friday ' a move that had helped restore a measure of confidence in the Italian markets after days of turmoil. But markets faltered by midday after a bond sale in which Italy raised euro4.96 billion ($7 billion) but at sharply higher rates.

Italy is under pressure to reassure markets that it can bring its accounts in order and promote growth, or risk being swept into the debt crisis that has hit Greece, Ireland and Portugal. The government accelerated the approval ' from an original deadline of August ' to soothe jittery markets.

After the Senate vote on Thursday, the lower house will vote on Friday in what will be a measure of confidence in Premier Silvio Berlusconi's government.

The measures to spur growth involve credits for research, reforms to civil justice and measures to promote tourism and young entrepreneurs, Tremonti said. While Italy's debt is among the highest in the eurozone at nearly 120 percent of GDP, poor growth is seen by some as the overriding issue.

"Without the balanced budget, the monster of debt, which comes from the past, would devour our future and that of our children," Tremonti said.

Allies in the government, meanwhile, dismissed persistent rumors that Tremonti would leave his post over tensions with Berlusconi.

"I don't think that Tremonti will quit. I believe at this moment it is advisable that he remains at his post," Claudio Scajola, a member of Berlusconi's coalition, said.

Berlusconi last week was quoted by La Repubblica as saying Tremonti was "not a team player." The finance minister has been touched by a scandal involving a former aide and was forced to apologize to another minister last week after cameras caught Tremonti calling him "an idiot."


Page: 1


 
 
 
 
 
 
 
 
 
 
 





Our Privacy Policy --- About The U.S. Daily News - Contact Us - Advertise With Us - Privacy Guidelines