Bennenbroek notes how yesterday, Eurozone finance ministers yesterday agreed to give Greece an extra two years in which to reach its deficit targets, but left open the question of how the resulting financing gap would be funded. From a shorter term perspective, he notes that Greece sold EUR 4.06 bln in T Bills at auction today, less than the targeted EUR 5bln, as the Greek government sought sufficient funds to meet the cost of redeeming government bonds held by the European Central Bank. The finance ministers will meet again on November 20th at which time a 'definite decision' on whether to issue the next tranche of Greek aid is expected.
Elsewhere, Bennenbroek notes that peripheral Eurozone bond yields are under some pressure again today, with Spanish and Italian ten year yields both higher. He notes that the Euro is down, while Scandanavian currencies are the weakest G10 currencies today. Overall, he highlights the general risk off sentiment across asset classes, with Asian and European equities down. Between EZ jitters and the US fiscal cliff, Bennenbroek maintains his bias for USD strength.