Italy’s 1.9 trillion-euro ($2.4 trillion) debt remains sustainable and borrowing costs are within government budget forecasts, Maria Cannata, head of the country’s debt management agency told Class CNBC television.
Italy’s 10-year bonds yield 6 percent, a rate that is less than what was budgeted in Prime Minister Mario Monti’s austerity plan passed in December and in line with the government’s latest economic forecasts adopted in April, she said in an interview.
Italians now hold more than half of the government’s debt, a fact that Cannata said was both a sign of stability and of weakness. She told CNBC that while foreign investors in recent months haven’t been buying as much debt at auction as they traditionally have, they are not selling their holdings of Italian debt.
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