As the political drama in Greece continues to play out, it is worth noting that to the west more troubles are brewing.
From the BBC: Italy government borrowing rates hit euro-era high
The markets are viewing Italy’s ability to repay its debt as increasingly doubtful.
The spread between Italian and German 10-year government bond yields had widened to 488 basis points in early trading, its widest level since 1995.
The yield on Italian one-year bonds also jumped to 6.3% from 5.5% on Friday, though it later fell back to 6.1%.
By comparison, the yield on German one-year bonds is 0.26%.
Richard Hunter, head of equities at Hargreaves Lansdown stockbrokers in London, said the worries over Italy were not so much about the economy but about the state of the political situation.
"This may be the beginning of the end for Berlusconi," he told the BBC.
