The spread between BTPs and Bunds opened at 88 basis points on the morning of March 24, a sharp decline compared to the 104 points reached yesterday. The words of US President Donald Trump came to calm the markets, postponing the ultimatum to Iran on the Strait of Hormuz and opening negotiations to reach an end to the conflict in the Middle East.
Tehran denied any talks with the US, but the markets wanted to believe Trump. For Italy this represents a respite, just a few hours before the start of the end-of-month auctions of government bonds, which will begin tomorrow 25 March.
Spread falling to 88 points, BTPs saved by Trump
Yesterday, Monday 23 March, raised fears of a return to very high levels, at least for the recent past, of the spread. The differential had exceeded 104 basis points by mid-day and risked continuing to increase, in the wake of international tensions linked to the war in the Middle East and the approaching deadline of the USA, which had threatened to attack Iranian power plants if the Strait of Hormuz was not unblocked in a few days.
However, US President Donald Trump intervened, postponing any attack and speaking of positive talks with Tehran for the end of the war. Iran denied any contact, but the markets believed Trump. The stock markets recovered and the spread immediately came back under control.
Opening on March 24, the spread fell to 88 basis points, with yields at 3.88% for 10-year benchmark BTPs. Bund yields are also under control, remaining at exactly 3%.
France and Spain stable
While Italy’s situation proves volatile, Spain has remained stable. The Bonos maintained the same distance as yesterday from the Bunds, protected by the government’s massive interventions on the cost of energy and by the lower exposure to fossil fuels. The spread fell slightly to 52 points, with yields at 3.52%.
| Government bonds | Returns | Spreads |
| German Bunds | 3.00% | – |
| Italian BTPs | 3.88% | 88 |
| French Oats | 3.71% | 71 |
| Spanish bonos | 3.52% | 52 |
Very similar situation for France, which remained at 71 basis points of spread with Oat yields at 3.71%. Paris has found stability again after a very difficult second part of 2025 due to political turbulence.
The Treasury takes a breather ahead of the auctions
Monday’s peak had made the Treasury fear that it would have to face the end-of-March auctions, which begin tomorrow, with a spread of over 100 points and government bond yields of over 4%. Trump’s words avoided this scenario, calming the markets at least in part and limiting the damage that the blockade of the Strait of Hormuz caused to investor confidence.
The auctions of the next few days will be:
- the auction of Btp Short-Btp€i on 25 March;
- the Bots auction on March 26;
- the auction of medium-long term BTPs will take place on 27 March.
