There have already been some wild moves in.....>

EGBS: There have already been some wild moves in Italy BTPs this morning with

the 2-yr coming under some intense pressure, with the yield at one point spiking

over 100bps at one point to 1.912% and highest level since Jan 2014. It

currently trades at 1.606% but markets are illiquid and volatile.

- Continued political concerns in Italy with Five Star Movement leader on Monday

calling on supporters to protest peacefully, and started to begin work on likely

fresh elections. 10-yr Bund/BTP spread is 16bp wider at 250bps.

- Spain and Portugal are also being dragged wider by the falls in Italy, however

it is the long end of Spain that is suffering the most with 30-yr yield 26bps

higher at 2.947% compared to only a 4.5bp move higher in 2-yr Bonos.

- Long end of the Euribor curves rises 3.5 to 4 ticks as markets continue to

price out any chance of the ECB being able to reduce monetary policy stimulus in

the near future.

- There is some Italian consumer confidence data at 0800GMT, but this is

unlikely to support BTPS with attention squarely on the political situation.