Italy paid a record 6.29 per cent yield to sell five-year bonds today in the first auction held after former European Commissioner Mario Monti was asked to head an emergency government charged with tackling the debt crisis.

Italy, which last week saw bond yields soar past the 7 per cent level that has triggered international bailouts for Ireland and Portugal, raised the maximum targeted amount of €3 billion at the sale.

Despite an easing in market pressures on Italian government bonds, the auction yield marked a new euro lifetime record - up from 5.32 per cent at an auction last month.

On the secondary market the yield on the September 2016 BTP stood just above 6.40 per cent today.

At the worst of last week's market turmoil it had peaked at around 7.8 per cent.

Reuters