* EU finance ministers unlikely to OK Greek aid release
* Euro zone GDP growth data to confirm slowdown
* Bund yields could fall to 1.3 percent
By Emelia Sithole-Matarise
LONDON, Nov 12 (Reuters) - German bonds slipped on Monday after Greece said it could refinance debt this week but losses were limited by uncertainty over the outcome of talks on aid for Athens and a potential U.S. fiscal crisis.
Investors focused on a euro zone finance ministers’ meeting later on Monday which will discuss Greek progress on controlling its debts but is not expected to release a new tranche of funding despite Athens approving a tough 2013 budget on Sunday.
Jean-Claude Juncker, chairman of the finance ministers, said Greece was on track to meet its commitments but that there would be no decision on Monday on disbursing aid.
Bunds were seen remaining near two-month highs.
“I don’t think we are going to get anything concrete (from the finance ministers) in terms of the next Greek aid tranche,” a trader said.
“The market is pretty constructive as long as the global economic backdrop remains uncertain given the U.S. fiscal cliff. I don’t see why Bunds should trade off particularly.”
The Bund future was last seven ticks lower on the day at 143.07. The contract rose more than a point last week to 143.47, its highest in just over two months as renewed concern over Greece and global growth triggered flight to quality.
Athens has to redeem 5 billion euros worth of treasury bills on Nov. 16 and had been counting on cash from the next aid tranche to help cover that. That has left it with not much choice but to roll over the bills.
“Greece has said they’ll get enough money to cover the 5 billion maturing bills this week but there’s still an unknown hanging over the market on when the Eurogroup is going to approve the aid,” another trader said.
German 10-year yields were steady at 1.34 percent . Some strategists said they could fall as low as 1.3 percent in coming days with gross domestic product data from Germany, France and Italy this week widely expected to confirm a slowdown in the euro zone’s leading economies.
Investors also remain concerned that spending cuts and tax increases due to kick in early in 2013 could derail the U.S. recovery if Democrats and Republicans in Congress fail to reach a deal before the end of the year.
“Whilst there’s uncertainty remaining on Greece and the U.S., core government bonds will remain underpinned but I think 10-year Bunds at these levels look pretty rich,” Nick Stamenkovic, strategist at RIA Capital Markets, said.
“Near term we could see Bund yields test the 1.30 level but at those sort of levels investors will be reluctant to push the yield significantly lower unless we see signs of significant disagreement in the U.S. and/or problems with financing in Greece,” Stamenkovic said.