Bond spreads for Italy and Spain rose sharply following the February 25 Italian parliamentary elections that produced no clear governing majority, foreshadowing legislative deadlock over austerity policies and possibly another round of elections.
On the day, Italy's 10-year bond spread (against the German bund) rose 56 bps, while the same spread for Spain increased 29 bps. The yield for the Italian 10-year bond is now at 4.85 percent, while Spain's is 5.33 percent.
The bond spread for France was stable at 82 bps, while the UK spread stood at 59 bps.
