Italy made another strong foray into bond markets yesterday, borrowing €6 billion at much lower rates in three- and seven-year operations, a sign that the debt crisis could be easing.

The Italian central bank said Rome borrowed funds for three years at 2.76 per cent, compared with 3.41 per cent in its last similar operation, and placed seven-year bonds at 4.30 per cent, down from 5.81 per cent.

The Italian treasury had planned to raise between €4.5 billion and €6 billion with the two bond issues, and reached the higher figure amid demand for a total of €9.8 billion.

Investors appear to have growing confidence in Italy, which three months ago was seen as a possible future victim of the eurozone debt crisis.

On Tuesday, the treasury said it had successfully raised €12 billion in three-month and one-year bonds at sharply lower rates. Market pressure on the country began to ease in January, with rates for reference 10-year bonds falling below five per cent from seven per cent late last year.

Rome is carrying a staggering debt load of around €1.9 billion, equivalent to 120.1 per cent of its annual gross domestic product.

It is due to issue almost €450 billion worth of short- and medium-term debt this year.