In sovereign news, according to FT the Greek PSI negotiations continue to remain tense with the Troika demanding greater concessions than levels already agreed to by Greece and IIF (which represents the private creditors). Negotiations are expected to go right down to the wire with the market pinning their hopes for an agreement prior to tonight’s EU finance meeting. The IIF have offered to accept 50% write-downs on face value or 64-70% losses in terms of NPV (due to term extensions and reduced coupons). IIF’s managing director was quoted on Friday saying “we are at the limits of a voluntary deal” clearly drawing a line in the sand. More »

In sovereign news, according to FT the Greek PSI negotiations continue to remain tense with the Troika demanding greater concessions than levels already agreed to by Greece and IIF (which represents the private creditors). Negotiations are expected to go right down to the wire with the market pinning their hopes for an agreement prior to tonight’s EU finance meeting. The IIF have offered to accept 50% write-downs on face value or 64-70% losses in terms of NPV (due to term extensions and reduced coupons). IIF’s managing director was quoted on Friday saying “we are at the limits of a voluntary deal” clearly drawing a line in the sand. In credit news, Moody’s released a series of reports cautioning further bank rating downgrades due to the European debt crisis, economic uncertainty and deteriorating market funding conditions. The ratings agency added that they expect to place a number of banks under review for downgrade during first quarter 2012. GE reported 4Q11 earnings of US$3.7bn down 20% pcp but in line with expectations. GE capital pre provision profits were up 31% pcp and 10% qoq to US$2.85bn. This was largely driven by cost cutting (down 18% pcp) outpacing a decline in revenues (down 9% pcp). In economic news, today PPI data was released. Prices increased 0.3% qoq which was below expectations of 0.4%. Final stage domestically produced items were unchanged. Final stage imported items rose 2.3% qoq. The market’s focus will be on the CPI number due for release on Wednesday. Given that it's Australia Day on Thursday, this week's quotes are nationalistic: "When considering the stature of an athlete or for that matter any person, I set great store in certain qualities which I believe to be essential in addition to skill. They are that the person conducts his or her life with dignity, with integrity, courage, and perhaps most of all, with modesty. These virtues are totally compatible with pride, ambition, and competitiveness." Don Bradman More »

In sovereign news, following yesterday’s Daily (23-Jan-12), eurozone finance ministers rejected a deal presented by private owners of Greek debt as a maximum offer for the losses they are willing to sustain. More »