LONDON Feb 16 The premium investors demand to
buy Greek, Portuguese and Irish government debt rather than
German benchmarks rose on Tuesday after euro zone states urged
Greece to announce more deficit-control steps by mid-March if
The spread widening came just ahead of the German ZEW
investor sentiment survey which helped pare 10-year Bund futures
gains by a few ticks FGBLc1. [ID:nDEG005625]
The cost of insuring Greek government bonds against default
also advanced, to 369,800 euros per 10 million euros of exposure
from 354,300 euros late on Monday, according to 5-year credit
default swaps from monitor CMA Datavision.
The 10-year Greek/German GR10YT=RREU10YT=RR bond yield
spread widened by 30 basis points on the day to 335 bps versus
305 basis points at Monday's settlement close, and was at its
widest since Feb. 9. There was little trade in Greek bonds on
Monday due to a public holiday in Greece.
The equivalent Portuguese PT10YT=RR spread widened 21 bps
on the day to 143 bps, while the Irish equivalent spread over
euro zone benchmark Bunds widened by 8 bps to 153 bps ahead of
the results of auctions of 2014 and 2020 debt. Both spreads were
at their widest since Feb. 10.
Ten-year Italian BTPs edged three bps wider to 88 bps, also
their largest gap since Feb. 10. Portuguese and Italian CDS were
little changed, CMA said.
Euro zone states urged Greece on Monday to take further
steps to control its budget but did not elaborate on last week's
pledge to defend the country if market pressures spin out of
(Reporting by George Matlock)