Comments by Italian economy minister, Roberto Gualtieri
- Have always been in favour of use of ESM recovery fund
- Yesterday's SURE scheme bond sale success shows common debt issues must become permanent instruments
Reading past the obvious in the headline, the EU saw its highest-ever demand for a bond sale yesterday i.e. over €233 billion as it raised funds for its SURE scheme. For some context, the issue was only €17 billion, so demand was more than 13 times that.
This is just the first stage of borrowing issuances by the EU, which over time will make it one of the region's biggest borrowers.
From a valuation basis, you can understand why the bonds issued appear more attractive to investors i.e. higher yields than bunds with a strong credit rating to boot.
That is perhaps what is also contributing to the better euro sentiment so far this week, though from a technical perspective, EUR/USD climbing above 1.1800 and the 9 October high @ 1.1831 also signals at positive momentum from buyers in the near-term.
