Italy’s borrowing costs at record low in 2021, set to rise slightly

Milan: Italian borrowing costs reached a record low of 0.1% in 2021, and are set to rise only modestly in 2022, the Treasury’s head of debt, Davide Iacovoni, said on Monday.

Thanks to lower state sector borrowing requirements, Italy is expected to issue between 80 billion and 90 billion euros ($90-$101 billion) of debt in 2022, down from 113 billion euros in 2021.

The Treasury said it expected the European Central Bank to buy “well over one half” of Italian issuance in 2022, continuing the central bank’s government bond purchases to support the euro zone economy.

Uncertainties about inflation and the pandemic will translate into higher borrowing needs, as it happened in 2020, and keep overall issuance above 2019 and 2018 levels, Treasury director general Alessandro Rivera told journalists. “Despite the very delicate situation, the outlook for next year is encouraging,” he said.