Italian borrowing costs slide

[August 26, 2011]  MILAN (AP) -- Italian borrowing costs dropped considerably in a pair of bond sales that easily raised euro10.5 billion ($15.15 billion), helped by the European Central Bank's program to buy peripheral bonds.

Yields on six-month bonds dropped to 2.14 percent, from 2.269 percent last month. The auction Friday raised euro8.5 billion and was oversubscribed by 1.66 times, compared with 1.56 percent last month.

Borrowing costs for 24-month bonds dropped to 3.408 percent, from 4.038 percent last month.

Italian yields have eased since the ECB began buying Italian and Spanish bonds Aug. 8 in an effort to stem the worsening debt crisis. Six-month yields peaked at 2.8 percent, while 24-month yields reached a high of 4.5 percent.

[Associated Press]

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