The Return of the PIGS: 10Y Italy, Greece Yields Spike Over 40 BPS

By Anthony B. Sanders

2Y Italian Yield Spikes 153 BPS

A general rule of thumb is that whenever sovereign yields spike by over 10 basis points, it is a big deal.

So Italy and Greece 10-year sovereign yields spiking over 40 basis points this morning is a big deal! The third PIG (Portugal) is up 11.3 BPS.

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For the 2-year sovereign debt, Italy is up over 153 BPS.

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The PIGS sovereign yield curves are showing stress.

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The cause of Italy’s woes? The rise of populist political parties such as the Five Star Movement.

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PIGS refers to fiscally-troubled European nations Portugal, Italy, Greece and Spain with high debt-to-GDP ratios. Italy is second behind Greece and Portugal is third.

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What about T2 (aka, Target2)?

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Stay tuned.

Published by

Gary

NFTRH.com & Biiwii.com