Italy saw its borrowing costs decline sharply at a debt auction on Wednesday. The Italian Treasury sold it maximum target of EUR 9 billion of 179-day bills at a rate of 3.251 percent, half of 6.504 percent paid in the previous auction held on November 25. Demand also improved with the bid-to-cover ratio rising to 1.69 from 1.47. The agency also sold EUR 1.732 billion of 2- year zero coupon bonds. The yield plummeted to 4.853 percent from 7.814 percent. Demand was 2.24 times the amount on offer, which was higher than 1.59 in the previous auction. The Treasury had planned to place between EUR 1.5 billion and EUR 2.5 billion of two-year debt.