BTP, calm before the storm, trigger the interest rate

2018年8月21日

hello guys here's a new idea on italy BTP. First of all, we saw recently that the market wants to speculate (again) on BTP, this means that interest rate until September will go down, then will rise due to rating agencies decision and what is called 'DEF', the document of economics and finance by the Government. In this document there'll be the outline of fiscal policy, I expect a higher deficit and maybe a cut in taxes.
This will trigger a sell in the bond market of BTP, driving interest rate up and consequently price down.
Here I post a couple of interest readings on Italy, which can give us some idea of what to expect.
zerohedge.com/news/2018-08-13/italy-gives-ecb-ultimatum-guarantee-bond-spreads-or-euro-will-be-dismantled
zerohedge.com/news/2018-05-28/which-banks-are-most-exposed-italys-sovereign-debt-other-horribly-exposed-italian

au revoir,
docCDS