Italy and Spain Outperform: Borrowing Costs Hit 16-Year Lows
Macro AntonECONOMY
A Reversal of Fortunes
In a remarkable economic turnaround, Italy and Spain are now outperforming their northern European counterparts, with borrowing costs relative to Germany hitting their lowest levels in 16 years. The spread between Italian BTPs and German Bunds has narrowed significantly, reflecting growing investor confidence in the fiscal discipline and economic resilience of Southern Europe.
While Germany struggles with industrial stagnation and recessionary pressures, Italy and Spain have benefited from a booming tourism sector, effective implementation of EU recovery funds, and robust services growth. This divergence signals a potential structural shift in the Eurozone economy, where the traditional 'core' and 'periphery' roles are being redefined.
