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2026-05-26 17:13:14
[Italian Bond Auction Meets Low Demand, Market Risk Aversion Strong, Long-Term Demand Underlying Concerns] ⑴ On Tuesday, the Italian Treasury auctioned three BTP bonds. The €2.5 billion bond maturing in February 2028 had a gross yield of 2.73% and a bid-to-cover ratio of 1.62, a 7 basis point decrease from the previous auction. ⑵ The €1.5 billion bond maturing in August 2031 had a gross yield of only 0.89% and a bid-to-cover ratio of 1.62, a 9 basis point decrease from the previous auction. ⑶ The €1 billion long-term bond maturing in February 2046 had a gross yield of 2.25% and a slightly higher bid-to-cover ratio of 1.81, indicating relatively stable demand for long-term bonds, but overall subscription ratios remained low. ⑷ From a trading psychology perspective, the sharp decline in short- and medium-term bond yields reflects an influx of funds into safe-haven assets. Continued market concerns stemming from Trump's tariff rhetoric have led investors to prefer locking in stable returns over shorter maturities. (5) Although the absolute yield of the 2046 ultra-long-term treasury bond is higher than that of the 2031 bond, the bid-to-cover ratio is only 1.81, indicating that the market still has doubts about the outlook for long-term interest rates. In the future, attention should be paid to European economic data and global trade policy trends.
