Public debt, 2026 scenario with record spread in the 50 area. Investors look to Italy and Spain

Full steam ahead on retail issues, average maturities being lengthened with the hypothesis of reopening the chapter of 50-year "matusalem bonds", and an eye on opportunities even on issues in foreign currencies such as the dollar, to respond to global investors' interest in Italian debt. These are the three main pillars of the debt strategy for Italy in a 2026 that opens under the banner of a revenge of the countries considered "periphery" of the euro area, such as Italy and Spain with respect to Germany: the former favoured by a more prudent budget that would get it out of the EU infringement procedure, the latter by the strongest economic growth among the advanced economies that the IMF forecasts at 2.9% for 2025.

Up to a spread over the bund at 16-year lows in the 70 and 50 basis points area respectively, and with the prospect of falling further: some economists hypothesise 50-60 basis points for Italy and 30-40 for Spain by 2026, thanks to German yields rising to the 3% area, at their highest since 2011, due to Berlin's borrowing to meet investments in defence and infrastructure.

In the meantime, Italy has seen an overall improvement in the State's requirements in 2025 to EUR 125.5 billion compared to the latest Dpef forecasts (EUR 127.2 billion), with a surplus in December rising to over EUR 11.7 billion from EUR 7.8 billion in the same month of 2024. There are two unknown factors: growth, which in Italy is expected to be very low even in 2026, and global market trends. With stock exchanges at risk of a heavy correction in the US. And with the Fed which, after having reopened its quantitative easing, arrives at the renewal of the presidency under strong political pressure.

The 2026 Public Debt Guidelines indicate that gross issues of medium- to long-term government bonds next year will be in the range of EUR 350 to 365 billion compared to EUR 380 billion in 2025. And they envisage "the continuation of the dedicated offer to retail investors" aimed at differentiating the investor base by leveraging households, whose share of government debt has doubled to 15 per cent in two years.

The Btp Valore, with which the Mef had placed around EUR 31.5 billion through two issues in 2025, in February and October, could return. And the Treasury 'could also consider' the return of the Btp Italia in 2026 - a security more closely linked to inflation - since a bond for about EUR 6.45 billion will reach maturity. The year-end document also draws a picture of the maturities where the Treasury intends to focus more in calibrating the debt offering. It states that 'the 10-year segment will continue to maintain its role as a reference point for the entire Italian nominal yield curve, also with a view to lengthening the average life of the debt'.