According to the earlier comments from Visco, a normal spread between 10-year German and Italian bonds is 100-150 bps. Even with today's leaks and moves, the Italian 10-year is at 3.89% and bunds at 1.72% -- a 217 bps spread.


The comment from Lagarde harkens back to her most-infamous utterance. This new tactic, which is rumored to be via selling German bonds to buy the periphery, threatens a backlash from the core.