FX.co ★ Italy 10-Year BTP Yields Rebound

Italy's 10-year BTP (Buoni del Tesoro Poliennali) yields increased to 3.5%, bouncing back from a recent low of 3.44% observed on January 7. This uptick is attributed to short covering and a rise in bond supply which prompted slight gains. Across the eurozone, there's a noticeable escalation in sovereign debt issuance. Specifically, Italy is preparing to release a two-tranche offer, comprising a newly introduced seven-year BTP and a €5 billion augmentation of its green bond set to mature in April 2046. On the macroeconomic scene, inflation within the eurozone reached the European Central Bank's (ECB) target rate of 2% in December, with inflation expectations remaining stable. This stability strengthens market confidence that the ECB will maintain its current interest rates. Álvaro Santos Pereira, an ECB Executive Board member and Governor of the Bank of Portugal, affirmed that the ECB’s monetary policy has been effectively bolstering the economy, leaving no immediate need for interest rate adjustments. In Italy, the domestic labor market exhibited strength, with the unemployment rate declining to a historically low figure of 5.7% as of November 2025.