Yields At Lows of Day

10-year BTPs yields have come off the highs to now trade at the lowest levels of the day, currently 5.3bps lower at 4.783%. The 10-year BTP/Bund spread falls back below the 200bp mark - now 8.6bps tighter on the day at 197.8bps.

• The strong performance of European equities alongside the softer USD has helped BTPs alongside peripheries more generally to find a bid.
• Concerns on Italy's growth and fiscal outlook remain relevant (see MNI Policy Mainwire at 13:17 and 13:33 BST for more), but have not been at the forefront of market moves this week. Expectations that the ECB has reached peak rates and are not expected to change QT in the near future remain the key themes.
• Industrial Production was the only datapoint on the Italian docket this week, and printed better than expected (but still weak at -4.2% Y/Y).
• Elsewhere in the peripheries, Portugal's budget proposal sees 2024 GDP growth of 1.5% Y/Y (vs an expected 2.2% Y/Y in 2023). The 10-Yr PGB yield is down 3bps at 3.539% today.