The spread between Italian BTPs and German Bunds reached 96 basis points at the start of September 29, growing by 2 points compared to the early hours of yesterday but falling to the peak reached at the close of 97 points. Yields reached a new annual record of 4.60%, one of the highest levels in 10 years.
Auctions of medium and long-term government bonds will be held today, which will conclude the September issues. These are two BTPs, one with 5 and one with 10 years, and one CctEu.
Spreads and yields continue to grow
Another complex opening for the spread. The differential has only returned to par from yesterday’s peak, when it reached 97 basis points at the close. At the opening of September 29th it recorded 96 basis points, falling by one point compared to the last reading but still showing an increase of two basis points in 24 hours.
Returns are a concern
However, it is the returns that stand out the most. The benchmark ten-year BTPs have in fact reached a 4.60% return for investors on average, the highest result of 2026. The record of 2023 is also approaching, when Italian bonds reached 4.80%. To find higher returns, then, we need to go back to the financial crisis.
In Europe the spread is no better than in Italy
Unlike the financial crisis, in which Italy found itself in a particularly critical position, at the moment the whole of Europe is suffering from particularly high yields on government bonds. In Spain, the Bonos reached a 50 point spread at 4.14%, while the French Oat reached a 113 point spread.
| Government bonds | Returns | Spreads |
|---|---|---|
| German Bunds | 3.64% | – |
| Italian BTPs | 4.60% | 96 |
| French Oats | 4.77% | 113 |
| Spanish bonos | 4.14% | 50 |
It is the result of a series of factors, which is also pushing interest on German Bunds to record levels:
- the markets’ fears for the energy crisis caused by the wars in the Middle East and Ukraine;
- the ECB’s interest rates, high and expected to increase precisely to combat inflation;
- competition from US Treasury Bonds.
The September government bond auctions end today
Auctions for medium and long-term securities will be held today, the last ones in September. Available to investors there will be:
- a 5-year BTP with a 3.95% coupon;
- a 10-year BTP with a 4% coupon;
- a 10-year CctEu with an annualized rate of 3.237%.
Following the settlement of this issue, this month’s auctions will conclude, awaiting the opening of those in October. The dates to mark on the calendar are:
- Friday 9 October for the Bot auction;
- Tuesday 13 October for the auction of medium and long-term bonds;
- Tuesday 27 October for the auction of Short Term BTPs and BTP€i;
- Wednesday 28 October for the Bots auction;
- Thursday 29 October for the auction of medium and long-term bonds.
Finally, a new issue of the BTP Valore will be held between 19 and 23 October, reserved for private investors.
