MILAN, Italy, April 29 (UPI) -- Italy's need for an international loan remains uncertain, a senior credit analyst at Moody's Investors Service said, but its borrowing costs dropped Monday.
"We cannot yet rule out Italy will end up asking for help from the European Central Bank and the European Stability Mechanism," Dietmar Hornungs said.
The New York Times reported the Italian government's borrowing costs for 10- and five-year bonds fell to under 4 percent and 3 percent, respectively, on strong demand at a bond auction.
The Italian government sold $3.9 billion 10-year bonds, which lowered the yield to 3.94 percent, down from 4.66 percent a month ago.
Interest rates for five-year bonds, at 3.65 percent at an auction in March, dropped to 2.84 percent, the Times said.
Italy's new prime minister, Enrico Letta, said Monday he had assembled a coalition government that restored some confidence in the country's economic state.
"It's clearly an authoritative government. Letta is competent and has experience. The key issue is, however, how long will this government last and what it will be able to do. This will become clearer in the coming weeks," said Andrea Cuturi, vice chairman of Anthilia Capital Partners.