ROME: The Bank of Italy’s liabilities towards other euro zone central banks rose to a new record high of 326.95 billion euros ($367.5 billion) in August, above levels seen four years ago at the height of the euro zone’s debt crisis.
Positions within the Target 2 system, which settles cross-border payments in the euro zone, are monitored because they can signal financial stress, for example when banks in a country lose foreign funding. However, seasonal factors such as the end of a quarter can also affect it.
The Bank of Italy said in July the recent increase in its Target 2 position was driven by foreigners selling Italian assets, especially bonds, and Italians buying foreign assets, movements which were only partially offset by Italian banks raising more funds on international markets.
