After pricing their 7 yr note yesterday at almost no premium to the market, Greek debt is not trading well the day after even in the new IMF/EU world they live in as yields are higher across the Greek curve on continued worries about their long term fiscal situation. 10 yr yields are rising to match the highest level in a month at 6.45% and 7 yr yields are up by 19 bps to 6.24%. The Greek hope with the IMF/EU was not just to provide a worst case backstop but to also help immediately lower borrowing costs. Greek stocks are down 1.5% even as the rest of European stocks are higher. Japanese stocks closed at the highest since Oct ’08 and the rest of Asia was up after a South Korean manufacturing index rose to at least the highest since ’03 when it was 1st introduced. On the China/US Congress battle on revaluing the Yuan, a Chinese official said “trade flow is determined by supply and demand instead of the exchange rate.”
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