• Market still awaits an outcome of ongoing negotiations between the Greek government and the IIF. The IMF is pushing for the new debt swap deal to have a coupon near 3.5% whereas the IIF have been holding out for 4%. Some progress seems to have been made with the IIF seen likely to give way, and a deal could well be reached tonight.
• Conflicting pressures from the bond market; Italian 5yr bonds fell back below 6% for the first time in 7 weeks but the Portugal/Germany 5yr spread widened again.