Treasury yields plunge as Italy’s political turmoil sparks safety bid

• Italy’s president rejected euroskeptic economist and former banker Paolo Savona for finance minister.
• He must now form a new government or call for another election.
• US yields are sharply lower as money pours into safety.

And while yield in Europe are surging, heavy buying pushed the US 10-year yield down as much as 13 basis points to 2.79%, its lowest level in 7 weeks. Here’s a look at the scoreboard as of 7:04 a.m. ET:

• 2-year -6 bps @ 2.42%
• 3-year -8 bps @ 2.53%
• 5-year -9.4 bps @ 2.67%
• 7-year -9.9 bps @ 2.79%
• 10-year -8.7 bps @ 2.84%
• 30-year -6.8 bps @ 3.02%

Buying has flattened the yield curve, with the 2-10-year spread tighter by 3 bps at 42.7 bps. It is currently on track for its flattest close since 2007. 

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