All European bonds, especially those of Italy, came under strong pressure today.

It is recalled that the Italian Government last week announced the figures for the Budget, which show a clear deterioration of the country’s fiscal position.

It is noted that in order to cover its loan needs the Italy it is estimated that in 2024 it will have to issue bonds with a nominal value of 330 billion. euro !

Markets reacted “violently” today with massive liquidations of Italian government bonds, sending the yield on 10-year bonds to the highest in a decade.

At the same time, it seems that part of the liquidations comes from Italian banks (the third largest economy in the eurozone) which are liquidating their own holdings in government bonds at the fastest rate in the last two decades.

Last week the spread between 10-year Italian-German bonds crossed the 2% barrier, but remained much lower than the historic high of 5.70% reached shortly before Silvio Berlusconi resigned as prime minister.

On the contrary, it is recalled that in Hellas the draft Budget submitted yesterday to Parliament predicts that this year the primary surplus will increase to 1.1% of GDP against the 0.7% that was the target, while in 2024 it is predicted that it will be 2.1% of GDP.

However, later in the day, in the early afternoon, the wave of liquidations receded, with the result that bond prices recovered some of the lost ground. . In Europe, Germany’s 10-year bond is just below 3%, France’s at 3.5%, Italy’s at 4.9% and Spain’s at 4.1%.

However, the head of the ECB, Christine Lagarde, in her speech at the ECB Conference in Frankfurt, reiterated that interest rates will remain elevated for a long time to contain inflation. Her view seems to be supported by most European officials, even those who oppose any further increase. The ECB has already gone through 10 consecutive interest rate hikes with the key rate climbing to 4.5%. The next meeting is on October 28.

In the secondary bond market today, and more specifically in the Electronic Transaction System (HDAT) of the Bank, transactions of 110 million euros were recorded, of which 68 million euros related to purchase orders.

The yield on the Greek 10-year bond stood at 4.47% from 4.41% that closed yesterday, against 2.94% of the corresponding German bond, resulting in the spread at 1.53% from 1.48% yesterday.

In the foreign exchange market, the euro moves upwards against the dollar, with the result that in the afternoon the European currency trades at 1.0506 dollars. from the $1.0492 level, which opened the market.