The hits just keep on coming in the wake of the near-certainty that Greece will be able to complete its debt swap deal today, and, in doing so, prevent the entire eurozone from collapsing. Well, maybe it’s not that dramatic, but there is some good fallout from the deal.
Italian yields on 10-year sovereign bonds, for instance, fell 20 basis points today and Spain’s 10-year bonds fell 8 basis points. The yield on Italian bonds is now 4.76%, the lowest its been since June of 2011. Spain’s yield on its 10-year bonds is down to 5.03% this morning.
Perhaps even more meaningful is the spread between Italian and German yields, down this morning to 2.92%, down 23 basis points and the closest the two have been since last August.