Italy's 10-year BTP yield drops on election and weak economy

Italy's 10-year BTP yield dropped to 3.63%, slightly below the two-month highs seen earlier in the month, as early U.S. election results indicated a higher likelihood of a Trump victory.

Italy's 10-year BTP yield drops on election and weak economy

A potential Trump win is expected to present significant challenges for Europe, particularly concerning trade tariffs, security issues, and continued support for Ukraine amid ongoing geopolitical tensions. Additionally, the outcome has led to a reassessment of European Central Bank (ECB) policy, with traders adjusting their expectations for future rate cuts. The deposit rate is expected to fall to 2% by 2025, down from the earlier projection of around 2.1%. On the domestic front, Italy's economic growth stalled in Q3, with harmonized inflation ticking up to 1%.

Italy's manufacturing PMI declines amid economic uncertainty

Furthermore, Italy's manufacturing PMI unexpectedly declined in October, reflecting ongoing challenges in the country's industrial sector amid the broader economic uncertainty.