Italy sells top amount in bonds, 7 and 15-year yields fall

MILAN: Italy sold seven- and 15-year debt at lower yields at auction on Tuesday as bonds in the euro zone drew support from the possibility that the European Central Bank may expand its bond buying programme next year.

Italy raised a total of 7 billion euros ($8 billion), meeting the top of its planned issue range.

The Treasury sold 3.5 billion euros of a new three-year bond due in October 2018 at an average 0.25 percent yield, little changed from the 0.24 percent it paid a month ago on the May 2018 three-year benchmark.

Demand for the new bond totalled 1.5 times the amount sold, compared with a bid-to-cover of 1.6 at last month's smaller three-year auction.

Italy also sold a new tranche of a September 2022 seven-year bond at 1.24 percent, down from 1.37 percent at a similar auction in mid-September. The sale was covered 1.5 times, up from nearly 1.4 times last month.

A 15-year bond maturing in March 2032 fetched a 2.14 percent yield, sharply down from 2.63 percent in July when Italy last sold it. Tuesday's sale was covered nearly 1.7 times against 1.3 times in July.