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In recent months, the relationship between the European Central Bank (ECB) and Italy has taken an unexpected turn, characterized by a climate of growing trust that has helped strengthen the country’s positioning on international financial markets.
A tangible example of this evolution is the success recorded by the Buoni del Tesoro Poliennali (BTP), which continue to attract both domestic and international investors, consolidating the perception of Italy as a reliable and competitive market.
The triumph of BTP Value
Among the main protagonists of this positive phase, the BTP Valore stands out, a government bond designed for the average saver. With increasing coupons and loyalty incentives, the BTP Valore has met with unprecedented interest since its first placement. This financial instrument is placed in a context of still competitive yields, a key factor in attracting investments from private individuals and institutions. The success of the BTP Valore is not an isolated case, but part of an overall strategy that aims to consolidate investor confidence. The structure of increasing coupons, together with incentives for those who hold the bond until maturity, represents a winning formula, capable of responding to savers’ needs for safety and profitability, in a historical moment characterized by relative stability of interest rates.
The European context
A key element of this new phase is the stabilization of the ECB’s monetary policy. After a period of high interest rates, the Central Bank expects a gradual reduction by 2025, with inflation approaching the 2% target. This scenario favors Italian bonds, which present themselves as an attractive alternative to those of other euro area countries. Even traditionally strong economies, such as Germany, are facing recessions, while France is faced with a growing public debt problem. In this context, Italian bonds emerge as a strategic choice for investors, thanks to a mix of competitive yields and improving economic prospects. The decline in the spread between BTPs and German Bunds, now stable at around 123 basis points, is a clear signal of this newfound confidence. This level is indicative of a significantly improved perception of country risk, an aspect also recognized by the ECB in its latest economic bulletin.
The markets’ response
The success of Italian bonds is confirmed by the numbers. The latest placement of the BTP Valore registered strong demand not only in Italy, but also in key markets such as the United Kingdom, France and Germany. The participation of Asian investors, attracted by the long-term prospects offered by Italian government bonds, was also significant. The BTP Green, designed to finance environmental sustainability projects and attract ESG ( Environmental , Social, Governance) investors, also achieved extraordinary results. With a total demand of 130 billion euros and a total placement of 18 billion euros, the BTP Green saw 80.2% of subscriptions come from international investors. The United Kingdom stood out as the main subscriber, with a share of 27.2%, followed by France, Scandinavian countries and Germany. At the same time, the 10- year BTP attracted a total demand of 140 billion euros, with a foreign participation of 76.7%. This success involved over 400 investors for the 10-year bond and 430 for the BTP Green, further consolidating Italy’s image as a reliable issuer.
The good strategy of the Italian Government
The government led by Giorgia Meloni has been able to take advantage of this favorable situation, adopting a targeted and diversified issuance strategy. The combination of traditional instruments, such as the BTP Valore, with innovative solutions, such as the BTP Green, demonstrates a clear desire to respond to the needs of an increasingly broad and diversified investor base. Furthermore, the stabilization of the internal political and economic context has played a fundamental role in consolidating investor confidence. This positive climate is also reflected in the real economy, with the unemployment rate in the euro area at a historic low of 6.3% and one of the largest reductions recorded in Italy.
Despite the overall improvement, it is important to also consider the weaknesses that characterize the Italian and global economy. Economic growth remains modest and structural challenges have not disappeared. However, the current context makes the alarms less justified than in the past. The evolution of the relationship between the ECB and Italy is a success story that deserves attention. The growing confidence in Italian securities, the improving economic and fiscal outlook, and the government’s ability to exploit the favorable moment are all factors that consolidate Italy’s position as a protagonist in the international financial markets.
Alessandro Fiorentino