Greece’s yields declined on Tuesday as European officials prepared to assess the country’s third set of economic policy proposals.
German Chancellor Angela Merkel urged Greek Prime Minister Alexis Tsipras at a meeting on Monday to do what is needed to qualify for another tranche of financial aid.
“The weakness in peripheral bonds is being driven primarily by supply this week,” said Soeren Moerch, head of fixed-income trading at Danske Bank A/S in Copenhagen.
“There is some indigestion in the market. While there’s still a lot of uncertainty about Greece debt talks, some headlines suggested the tone between Germany and Greece is improving.”
Portugal’s 10-year yields increased five basis points to 1.80 percent, while the rate on similar-maturity on Greek debt dropped 60 basis points to 10.89 percent.