MNI BRIEF: Eyeing Italy Spreads, Far From ECB Action -Visco

Italy's BTP spread over German bunds is “relevant” but currently sits far from triggering fragmentation risk in the euro area, Bank of Italy’s governor Ignazio Visco said Friday, noting there are “no signs that it should rise in a territory which would require us to intervene”.

Italy's ability to grow the economy -- with Visco beleiving more is possible -- is what is focusing market attention above other considerations on Italian debt, he said. However, his main concern at present is “geopolitical risk” with the situation unfolding after the attacks on Israel.

Although tensions in the Middle East can push energy prices higher to “not expected levels”, the risks are not the same as seen with recent high gas prices, Visco told Bloomberg TV, noting that the ECB 2% inflation target is very much still in sight.