Italy 6-month yields hit highest since February

MILAN, June 26 Wed Jun 26, 2013 5:18am EDT

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MILAN, June 26 (Reuters) - Italy's short-term debt costs almost doubled at an auction on Wednesday as expectations of a reduction of the U.S. monetary stimulus continued to weigh on riskier assets.

The treasury sold 8 billion euros of six-month bills, paying a return of 1.05 percent, compared with 0.54 percent it paid at a similar auction one month ago. It was the highest yield since February.

Demand was 1.36 times the offer, down from a bid-to-cover of 1.58 one month ago.

Italy will face a tougher market test on Thursday when it offers up to 5 billion euros of five- and 10-year bonds.