Italy's interest rate falls in EUR 6.5 bn bond sale

(MILAN) - Italy raised 6.5 billion euros ($8.2 billion) in an auction of 12-month bonds on Tuesday at a lower rate than in a similar auction last month, indicating improved confidence among investors on the debt market.

The rate was 1.762 percent compared to 1.941 percent on October 10 and the auction was over-subscribed, with a bid-to-cover ratio of 1.76.

The Italian treasury will try to raise up to 5.0 billion euros on Wednesday in an auction of medium- and long-term bonds.

Italy, the eurozone's third-biggest economy and one of the biggest world markets for sovereign bonds, is in a severe recession and has spent months battling investor fears that it might be forced to ask for financial aid.

-- Dow Jones Newswires contributed to this report --