Citing six sources familiar with the matter, Reuters reported on Monday that European Central Bank (ECB) policymakers consider the rise in Italian bond yields is justified by deteriorating budget fundamentals.

"I think Italy's troubles are entirely self-inflicted, so the market reaction is quite justified. But there is a lesson for us in that Pandemic Emergency Purchase Programme's (PEPP) flexibility is valuable that we shouldn't give up without thorough analysis," one of the sources told Reuters.