Italy's issues with the invading sovereign debt scourge did not prevent the 17-nation common currency from climbing in value against the U.S. dollar on Tuesday, MarketWatch reports.
The host of the euro zone's third-largest economy on Tuesday paid borrowing costs of 8 percent, which is of note because Greece, Ireland and Portugal each sought bailouts for their debt-hobbled banks and public finance systems when borrowing costs touched the 7 percent threshold, Bloomberg reports. Increasing expenses are symptomatic of the encroaching sovereign debt scourge that has not quit in two years.
"Nevertheless, Italy avoided crossing the key 8 percent barrier and was able sell the full allotment with bid-to-cover ratio of 1.5," currency research director Boris Schlossberg with GFT told MarketWatch. "The fact that [euro/dollar] was able rally off such dubious results from the Italian auctions says more about the oversold conditions in the forex market than it does about the underlying strength of the currency."
Of sizable concern to investors is how Italy will emerge from the scourge since its economy is larger than those of Spain, Greece, Ireland and Portugal.
The bond sale at the Rome-based Treasury accomplished more than $10 million in bond sales on Tuesday.
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