October 25, 2018 / 12:29 PM / a month ago

Italy bond spreads reflect lingering euro exit fears - Mediobanca CEO

MILAN, Oct 25 (Reuters) - The current yield gap between Italian and German government bonds reflects lingering euro exit fears among investors which must be removed once and for all, the chief executive of Italian merchant bank Mediobanca said on Thursday.

Speaking to journalists after the bank published first-quarter earnings, CEO Alberto Nagel warned that economic growth was bound to suffer if the risk premium Italian bonds pay over safer German paper remained at current levels.

“There is a portion of investors who are not fully convinced about the absence of redenomination risks (on Italian debt),” Nagel said. “The government has given some useful messages but such spread levels cannot be explained with ... the deficit figures.” (Reporting by Valentina Za)

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