The spread between Italian BTPs and German Bunds returned to 88 basis points, the same level as the opening on Monday 14 September, after a slightly declining close. We are approaching 90 basis points, well above the lows reached at the end of January with 57 basis points.
The yield on the ten-year BTP stood at 4.42% in a context of generalized growth in rates on European government bonds. The fear of having to resort to debt to refinance maturing bonds and the need to finance increasingly higher deficits is adding to the cost of energy.
Spreads and returns still unstable
The situation in the Middle East and the related consequences on energy still do not see a solution. This is why the context of instability persists. Yesterday we talked about an aggravation of the situation given by the advance of the Houthis in the south-west of Yemen, with the group coming to take full control of the Strait of Bab-el-Mandeb, one of the alternative routes to the Strait of Hormuz for Saudi oil.
The spread is close to 90 basis points
Once again, the spread is the first indicator of the consequences of this situation. Markets fear that the increase in oil prices will continue to weaken the Italian economy.
As a result, government bonds are perceived as riskier. For this reason, the differential, after having indicated a decline at the close of Monday 14 September, returned to 88 basis points at the opening of Tuesday 15 September, continuing the increase in the morning towards 89 and 90 basis points.
Yields at highest since 2023
Compared to January 2026, a 10-year BTP – the security used to calculate the differential – yields one percentage point more. On the morning of September 15, yields reached 4.42%, levels similar to those seen during the 2022 energy crisis. On the same morning, yields continued to rise, reaching 4.45% (+0.02%).
The spreads of other European countries
In the current context, Spain remains one of the few European countries not to be affected by the crisis. A strongly growing economy and a wide availability of energy from renewable sources keep investor confidence stable. The spread between Bonos and Bunds remains at around 48 basis points, with yields just above 4% (4.03%).
| Government bonds | Returns | Spreads |
|---|---|---|
| German Bunds | 3.51% | – |
| Italian BTPs | 4.45% | 89 |
| French Oats | 4.48% | 92 |
| Spanish bonos | 4.03% | 48 |
France is still one of the countries most suffering in this phase. The revision of the GDP led to an estimate of the deficit for 2026 at 5%, with consequences for the Oat. The spread with Bunds, after a phase of increasing to 95 basis points, dropped again to 92 basis points, with yields still close to 4.5% (4.48% to be precise).
The next auctions of Italian government bonds
The first auctions of September government bonds ended last week. There were two issues, one of BOTs, with two different products, and one of medium and long-term BTPs with three securities. The next auctions will be held at the end of the month:
- the auction of Btp Short and Btp€i on 24 September;
- the Bots auction on September 25th;
- the auction of medium and long-term bonds will take place on 26 September.
