LONDON, Dec 18 (Reuters) - Portuguese bond yields fell sharply on Monday after a two notch ratings upgrade from Fitch late on Friday that means the country now holds an investment grade from two of the three major rating agencies and could soon return to major bond indices.
Having traded briefly below Italian bond yields on Friday, Portuguese yields trade decisively below their Italian peers in early Monday trade.
Portugal’s 10-year bond yield was last down almost 5 basis points at 1.79 percent, while Italy’s 10-year bond yield was flat on the day at 1.81 percent. The last time Portuguese yields traded below their Italian peers for a sustained period was in early 2010. (Reporting by Dhara Ranasinghe, editing by Karin Strohecker)