May 29, 2018 / 10:53 AM / a year ago

Pressure on shorter Italian bonds compresses 2/10-yr spread to lowest since end-2011

MILAN, May 29 (Reuters) - A market sell-off that hit in particular shorter-dated Italian bonds compressed the spread between 2 and 10-year yields to 54 basis points, its lowest level since late 2011.

“The lack of trust in Italian assets has infected the short- term debt, which is a type of asset held by investors like cash funds and bank treasury desks who are risk averse and that’s dangerous,” said Giuseppe Sersale, fund manager at Anthilia Capital Partners in Milan.

“It’s a market that is totally in panic,” he added.

Reporting by Elvira Pollina and Danilo Masoni, writing by Valentina Za

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