EURO GOVT-Italy leads periphery wider on Greek worries

LONDON Feb 6 (Reuters) - Italian government bond yields rose on Monday as the euro zone's peripheral issuers came under pressure on uncertainty over a Greek debt deal as restructuring talks dragged on.

Greece's coalition parties must tell the European Union by Monday whether they accept the painful terms of a new bailout deal as EU patience wears thin with political dithering over implementing reforms.

"On Greece, the number of times we've heard 'there's something coming out this afternoon', and we're talking about it again today, I think the market's still a bit jittery around that," a trader said.

"Spain and Italy have had a decent run in the last month or so and there's a little bit of people taking a few chips off the table and waiting to see what comes out of this Greek situation.

Italian 10-year government bond yields were 9 basis points higher at 5.79 percent.

Portuguese bonds were volatile with 10-year paper last 20 basis points lower on the day at 13.96 percent after starting the session higher on the day.

IFR, a Thomson Reuters service, reported that Portugal has been sounding out advisors on options to restructure its debt.