Italian 10 year yields back over 6.4%, and rising. 2 year over 5.5% and rising. French 10 yr spread over 1.25% and rising. 2 yr euro swap spreads over 104 and rising.
And Italy is still in denial. Berlusconi this morning said that the pressure on him to act stems from prejudice against Italians. Good grief.
I would expect the ECB to come to the rescue this morning, and every morning, even if it means printing. Things could get ugly if they just let them go on. Italy needs to get its act together quickly, or all bets are off.
Update:
It doesn't appear the ECB came to Italy's rescue today, but their 10 year closed at about 6.35%. Perhaps the ECB is showing Italian politicians what's going to happen if they don't get rid of Berlusconi and implement real reforms, real fast. Either way, with Italian yields circling the drain, unless the ECB steps in, next week is going to be an ugly week.
Add to the uncertainty over whether reforms will even happen is the fact that Europe has now entered recession - even if reforms take place, deficits and debt will continue to rise. These are the [post flash / final] updates to the Eurozone PMI reports for October, with Italy and Spain now included.
And Italy is still in denial. Berlusconi this morning said that the pressure on him to act stems from prejudice against Italians. Good grief.
I would expect the ECB to come to the rescue this morning, and every morning, even if it means printing. Things could get ugly if they just let them go on. Italy needs to get its act together quickly, or all bets are off.
Update:
It doesn't appear the ECB came to Italy's rescue today, but their 10 year closed at about 6.35%. Perhaps the ECB is showing Italian politicians what's going to happen if they don't get rid of Berlusconi and implement real reforms, real fast. Either way, with Italian yields circling the drain, unless the ECB steps in, next week is going to be an ugly week.
Add to the uncertainty over whether reforms will even happen is the fact that Europe has now entered recession - even if reforms take place, deficits and debt will continue to rise. These are the [post flash / final] updates to the Eurozone PMI reports for October, with Italy and Spain now included.
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