Global bonds higher but Greece getting no respect

Greece still is getting no respect. While global bond markets are rallying in response to the weaker than expected ADP report and the Chicago PMI (half of the factory order # was out last week when Durable Goods orders were released and thus is rarely market moving), Greek bonds again are not as Greece can do little right in convincing the global community that their debt is money good and their deficit cutting plans will be implemented as said. The Greek 10 yr yield is rising another 8 bps to 6.52%, a 5 week high, their 2 yr yield is up by 22 bps to 5.13%, matching a 4 week high and 5 yr Greek CDS is wider by 7 bps to 340, just shy of a one month high. While the IMF/EU deal with Greece created an important backstop, it did nothing to lower the cost of Greek borrowing as hoped as it seems investors want to see actual results of deficit cutting rather than just promises.

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