The yield on European debt has risen sharply this Thursday in the face of the crisis facing the Government in Italy, which could trigger new elections, and on a day in which the European Commission has worsened economic forecasts for the eurozone, with inflation at record levels.
According to market data consulted by Efe, although the profitability of the sovereign debt of the Old Continent shot up during the morning, at the end of the session, it has risen, but moderately.
Thus, the return on the ten-year German bond, considered the safest in Europe, has risen to 1.17%, although during the session it has exceeded 1.2%.
The ten-year Italian bond has reached 3.22% at the close of the day, while its risk premium has again exceeded 200 basis points.
For its part, the Spanish bond has increased its yield to 2.24%, with the risk premium at 116 basis points.
As for the debt of other so-called “peripheral” European countries, Portuguese titles have increased their interest to 2.24%, while the yield on Greek bonds has risen to 3.44%.
IG analyst Diego Morín explains that the situation in Europe is “quite delicate”, an issue that was reflected in the uncontrolled increase in risk premiums last June after the last meeting of the European Central Bank (ECB), which announced the end of debt purchases and increases in interest rates.
Given this escalation, the ECB announced an anti-fragmentation instrument for the euro zone and the flexible reinvestment of the bonds acquired in the pandemic that began on July 1.
“We see that the situation of political instability that Italy is experiencing puts the European fixed-income market in check again,” says Morín, who warns that if the Italian government does not reach an agreement and an early election is reached, it would add increased instability in the euro zone.