Il costo dei CDS sul debito nostrano continua a crescere

Five-year Italian government CDS widened to 161.5 basis points from 155 basis points at Monday's close, while the French equivalent reached a record 56.8 basis points from Monday's 54.4 basis points.

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The move was most severe in Greek, Irish and Italian CDS, with 5-year Irish CDS having blown out almost seven-fold to 213.4 basis points on Tuesday compared with levels seen mid-September when the global financial crisis reached new depths with the collapse of Lehman Brothers.

Five-year CDS on Italian government debt widened from 47 basis points on Sept. 16, with similar moves from double digit to triple seen in CDS on UK and Swedish sovereign paper, according to CMA DataVision.

"In our opinion, the Italian budget will veer into unsustainability in 2009. By unsustainable we mean new debt issuance will be required to cover the interest payments in 2009. The same problem is likely to recur in 2010 as well," Chapman at UBS said.

"We also believe the average Italian state debt service cost is not likely to fall much from recent 4.4 percent unless the duration of the portfolio shrinks much more than we expect. In fact, the duration has been extending in recent years."

Italian and Greek government bonds have also cheapened sharply, with their yield premium over benchmark German Bunds soaring well over 100 basis points as investors switched into safer haven German assets. (...)

Reuters.com