First EU test fails as Italian yields hit euro-era high

Yields on 10-year Italian government bonds sold at auction have spiked to their highest level since the creation of the euro, as investors continue to fret over the health of the country despite yesterday's rescue deal.

The Italian government sold 10-year bonds at a yield of 6.06% at an auction today, selling €2.98bn of bonds maturing in 2022. The previous auction of 10-year Italian debt, held last month, saw bonds sold at a yield of 5.86%. Benchmark Italian 10-year bond yields themselves are currently above 5.91%, well above 10-year German bunds which are currently yielding 2.24%. Investors have shown they are less than reassured by Italy's prospects despite  yesterday's announcement from European leaders of a series of measures to tackle the region's debt crisis. Policymakers agreed to a pack...