Italy bonds rally for now

Italy’s government bonds had their best week in more than six years, and yields are at their lowest since 2016, prompting the government to lock in bargains by issuing 50-year debt this week but the driver isn’t budget prudence, but the prospect of ECB moves, providing a guaranteed buyer of Italian debt.
The risk is that the market backdrop emboldens deputy prime minister Matteo Salvini to push his aggressive tax cuts. That could revive tensions that roiled the country’s markets after the coalition government took office last summer, particularly as the coming year’s budget will be even tougher.