The yield on the 10-year BTP remains above 4.2%, close to the highest levels for over two years. For Italian savers, therefore, a question that already emerged during the previous phases of rate increases returns: is it better to buy BTPs now or is it preferable to wait?
The movement does not only concern Italy. The new rise in oil prices, inflation pressures and the fear of further rate rises have caused sales of government bonds in numerous countries. When a bond is sold, its price falls and the return offered to those who buy it increases.
In the early hours of today, September 3, the Italian ten-year yield was approximately 4.21%, against 3.94% a month earlier and 3.64% a year earlier. The German Bund stood at around 3.37%, leaving the spread close to 84 basis points.
Because BTP yields are increasing
The main cause is the return of the risk of inflation. Brent, after reaching almost 97 dollars, has returned to around 95 dollars a barrel. The slight decline reflects the absence of new attacks confirmed in the last few hours, but tensions between the United States and Iran and the reduction in transits in the Strait of Hormuz keep the risks for supply and prices high.
The ten-year US Treasury, after touching 4.82%, fell towards 4.77%. The German Bund remains at a 15-year high, while the Japanese ten-year bond exceeded 3% for the first time since 1996.
In this context, Italy must also offer higher yields to place its debt. Despite the rise, the BTP-Bund spread remains relatively limited. The movement therefore depends above all on the general increase in international yields and not, at least for now, on a specific crisis of confidence in Italy.
BTP at 4.21%: how much you really earn
The 4.21% yield does not necessarily coincide with the coupon paid by each BTP. It is the gross annualized return of the reference ten-year bond, calculated considering the purchase price, the coupons and the value reimbursed at maturity.
Applying only the preferential taxation of 12.5%, a gross return of 4.21% corresponds, in purely indicative terms, to approximately 3.68% tax net. The 0.2% stamp duty, any commissions and securities account costs must then be subtracted from the result.
On 10 thousand euros the annualized net tax return would theoretically be close to 368 euros. This figure does not necessarily coincide with how much is collected each year: part of the return may derive from the coupons and part from the difference between the purchase price and the value reimbursed at maturity.
The prices and yields of individual securities can be checked in the list of BTPs traded on the Italian Stock Exchange.
Is it worth buying BTPs now?
The higher yields make BTPs more interesting than in previous months, especially for those seeking periodic income and who can hold the security until repayment. In this case the intermediate price fluctuations take on less importance.
The risk is buying too early. If oil and inflation continue to rise, or the ECB and Fed decide on new rate increases, yields could rise further. As a result, the price of BTPs already purchased would drop.
The problem is greater for securities with very long maturities, which are generally more sensitive to changes in rates. Anyone who thinks they may need the capital before maturity must therefore consider the possibility of selling at a loss.
A possible prudential strategy consists in distributing the investment across multiple maturities or proceeding gradually, avoiding concentrating all the capital on a single security and in a single day. Convenience depends on your time horizon, goals and ability to tolerate fluctuations.
September 2026 BOT and BTP auctions: all dates
The Treasury Department calendar includes five appointments:
- September 9: Bot auction
- 10 September: auction of medium-long term bonds
- 24 September: auction of short-term BTPs and inflation-indexed BTPs
- September 25: Bot auction
- 29 September: auction of medium-long term bonds.
Deadlines, coupons and amounts will be specified by the Mef in individual press releases. The first announcement is expected on September 4th for the Bot auction on September 9th.
At auction, newly issued securities or further tranches are purchased through a bank or an authorized intermediary. On the secondary market, however, it is possible to immediately choose among the BTPs already in circulation, comparing their price, coupon, maturity and effective yield.
Taxation, ISEE and succession
Bot and BTP benefit from a preferential tax of 12.5%, lower than the 26% applied to most other financial income. Italian government bonds are also exempt from inheritance tax.
Up to a total value of 50 thousand euros per family unit, government bonds and savings products guaranteed by the state are excluded from the movable assets considered for the purposes of the ISEE. However, the 0.2% stamp duty on the securities deposit and any costs applied by the intermediary remain due.
With yields above 4%, BTPs are therefore competitive again, but the higher yield is not without risks. The most prudent choice remains to link the maturity of the security to the moment in which the capital is expected to be used, without relying exclusively on the coupon or yield of the day.
