- Recent news flow from Italy was mixed. While Fitch affirmed Italy’s rating at BBB- (after the surprise downgrade at the end of April) on Friday demand for the so-called BTP Futura traile market expectations.
- Orders for the first government bond exclusively dedicated to retail investors and with a premium linked to Italy’s nominal growth came in at only €6.1bn.
- This is well below the successful issuance of the recent BTP Italia in May. At that time, a total volume of €22.3bn was placed of which €14bn was allotted to retail investors.
- Although liquidity problems are very unlikely anytime soon it can intensify the discussion about Italy having recourse to external financial support provided by the ESM.