Italy 'vulnerable' without lower loan costs: PM
Italy's economy remains "vulnerable" unless borrowing costs on its 10-year sovereign bonds on the debt markets go back down to 3.0 percent from around 4.0 percent now, Prime Minister Enrico Letta said on Friday.
"As long as Italy does not reach 3.0 percent for its 10-year bonds and this does not become a reference point for the system, we will continue to be vulnerable," Letta said at a banking conference in Rome.
Italy has seen its borrowing costs ease since the height of financial market panic in November 2011 but they remain higher than those of countries that are seen as safe investments on the financial markets.
On Friday, Italy's rate was at 4.11 percent while Germany's was at 1.76 percent. The difference is made even worse for Italy by its enormous mountain of debt, which is close to €2.0 trillion ($2.7 trillion).
Italy's bond issues have gone well this year and on Thursday the Italian Treasury said it was cancelling two auctions scheduled for November and December because of lower funding requirements.
The European Commission forecasts that Italian public debt will reach 134 percent of gross domestic product (GDP) next year -- a record level for Italy and the second highest ratio in the European Union after Greece.
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"As long as Italy does not reach 3.0 percent for its 10-year bonds and this does not become a reference point for the system, we will continue to be vulnerable," Letta said at a banking conference in Rome.
Italy has seen its borrowing costs ease since the height of financial market panic in November 2011 but they remain higher than those of countries that are seen as safe investments on the financial markets.
On Friday, Italy's rate was at 4.11 percent while Germany's was at 1.76 percent. The difference is made even worse for Italy by its enormous mountain of debt, which is close to €2.0 trillion ($2.7 trillion).
Italy's bond issues have gone well this year and on Thursday the Italian Treasury said it was cancelling two auctions scheduled for November and December because of lower funding requirements.
The European Commission forecasts that Italian public debt will reach 134 percent of gross domestic product (GDP) next year -- a record level for Italy and the second highest ratio in the European Union after Greece.
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