Greek/German 10-yr yld spread widens above 200bps

LONDON, Dec 7 (Reuters) - The premium investors demand to
hold 10-year Greek government bonds rather than euro zone
benchmark German Bunds rose above 200 basis points on Monday
after Standard & Poor's said it may cut Greece's credit rating.

The yield spread, which had already been under pressure
earlier on Monday on worries about Greece's economic
fundamentals, hit its widest in a week at 201 basis points,
compared with around 174 basis points late last Friday.

The cost of insuring against a default on the Greek
sovereign debt rose to 185,700 euros per 10 million of exposure
from 181,600 euros in New York trading on Friday, according to
credit default swap prices from CMA Datavision.

S&P put Greece's A- sovereign rating on creditwatch
negative, meaning that it may cut the rating [ID:nN07162339].

S&P said it expected to make a decision within the next two
months, after receiving further information from Greek
authorities on their plans to counter intensifying economic and
fiscal pressures.

German news magazine Der Spiegel reported on Sunday Greece's
ballooning budget deficit and mounting public debt would be
discussed at the European Central Bank's Governing Council
meeting on Dec. 17.