Italian bonds decline as Letta faces confidence vote

Monday 30 September 2013 15.44
Yield on Italy's securities rose to the highest level in more than three months
Yield on Italy's securities rose to the highest level in more than three months

Italy's 10-year bonds fell for a third day after Prime Minister Enrico Letta said he called a confidence vote.

This comes after Silvio Berlusconi withdrew support for the nation's five-month-old administration.

The yield on the securities rose to the highest level in more than three months as Letta defied Berlusconi's attempt to force new elections, saying he would request the vote for October 2.

Italy's 10-year yield climbed 10 basis points to 4.52% today after earlier touching 4.66%, the highest level since June 27. The rate reached a euro-era record 7.485 in November 2011.

Letta needs 24 votes in the Senate to secure a new majority without Berlusconi, Corriere Della Sera reported. To do so, the 47-year-old premier must win over opposition lawmakers or get members of Berlusconi's People of Liberty party to abandon their leader.

Letta's plan to appeal to lawmakers won an endorsement yesterday from President Giorgio Napolitano, who is responsible for calling snap elections if parliament is deadlocked.