2026.03.1309:32:35UTC+00Italian BTP Yields Rise on ECB Rate Hike Bets

Italy’s 10-year BTP yield advanced toward 3.8%, its highest level since April 2025, as mounting tensions in the Middle East fueled inflation concerns and reinforced expectations of further interest rate increases by the European Central Bank. Oil prices continued to climb despite recent efforts to ease the energy supply shock, with investors doubting that these measures will be sufficient to fully offset potential disruptions in the Strait of Hormuz. The jump in energy costs has led money markets to price in two ECB rate hikes this year, a sharp reversal from last month, when no policy moves were expected. Attention now turns to the ECB’s upcoming policy meeting, where President Christine Lagarde is expected to indicate how the bank plans to shield the eurozone from inflationary pressures stemming from the conflict. Earlier this week, she stressed that the ECB would act to prevent a repeat of the inflation shocks that followed Russia’s invasion of Ukraine.