Greek debt traded poorly again today. The 2 yr note yield is now approaching 11% at 10.98%, up 29 bps on the day and now exceeds the 10 yield of 10.90%, up 15 bps on the day. Also, 5 yr CDS is wider by 40 bps to 920 bps, the highest since late June. In addition to continued fears that the Greek economy is choking on its austerity program, earlier this morning the Bank of Greece said bank deposits by households and businesses in Greek banks fell for a 6th straight month. In response, the euro is falling to a 5 1/2 week low vs the US$ and to just shy of a 9 year low vs the yen.
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