Italy 10-Year Gilt Yield Edges Higher

Italy’s 10-year bond yield edged up to around 3.59%, in line with other European peers, buoyed by upbeat PMI data from the Eurozone despite headwinds from US tariffs.

The composite PMI rose to 51.1 in August, above forecasts, with manufacturing recording its first expansion since June 2022 and the strongest in 38 months.

While pressures on prices built slightly, they were still below historical standards.

The positive data strengthen the ECB’s argument against quick additional rate cuts, following eight reductions since 2024, though markets still price in a 45% likelihood of another by year-end.

ECB President Christine Lagarde said the 15% US tariff on EU goods exceeded baseline expectations but remained far from the worst-case scenario.

All eyes turn to the Jackson Hole symposium and Fed Chair Powell’s Friday speech for clues on policy direction.