Italian borrowing costs sink to 6.4 percent

MILAN (AP) — Italian borrowing costs are well below dangerous levels as markets express confidence in the prospect that leading economist Mario Monti will form a new government without politicians.

Italian president Giorgio Napolitano tapped Monti on Sunday to create a government of experts to implement structural economic reforms aimed at bringing down Italy's stubbornly high public debt.

Napolitano emphasized that €200 billion ($273 billion) in Italian debt comes due through the end of April. On Monday, borrowing costs on benchmark 10-year bonds were at 6.4 percent — after spiking last week well above the 7-percent level that forced three other countries to seek bailouts.

Italy later will sell up to €3 billion ($4.1 billion) in five-year bonds in a fresh test of market sentiment.

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