And now we have to start talking about this.
It’s the Austria-German 10-year spread
The spread is widening further today, even as Italy improves and markets are rising.
What’s the deal with Austria? Well there have been persistent rumours about a downgrade, but furthermore, Austrian banks are famously exposed to Eastern Europe. And now you see stuff about how Slovenian yields are surging.
Too many fires to put out.
For a good background story on Austrian banks and exposure to Eastern Europe, see this NYT piece from last year.