by Calculated Risk on 11/25/2011 09:13:00 AM

From the WSJ: Italian Yields Jump After Poor Auction

Italian two-year and five-year government-bond yields soared to euro-era highs Friday as investors began giving up on the euro zone's ability to break the political gridlock that is blocking a more decisive response to the currency bloc's debt crisis ... The Italian treasury sold €8 billion ($10.67 billion) of six-month treasury bills and €2 billion of 24-month zero-coupon bonds. The six-month paper carried an average yield of 6.5%, sharply up from the 3.5% rate paid at its October auction.

The Italian 2 year yield is up to 7.84%. Ouch. The 5 year yield is at 7.8%.

Note: I've added the table of links to European bond yields below the first post.

Update: From Reuters: Moody's cuts Hungary to "junk," government sees attack

Moody's lowered Hungary's sovereign rating by one notch to Ba1, just below investment grade, with a negative outlook, hours after rival Standard & Poor's held fire on a flagged downgrade after Budapest said it would seek international aid. ... It also came after [Prime Minister Viktor] Orban relaunched aid talks this week with the International Monetary Fund, a dramatic reversal after he cut cooperation with the Fund short last year after sweeping a 2010 election on a vow to regain "economic sovereignty."