Following the ‘no default’ comment from Trichet yesterday with regards to Greece, another ECB official today reiterated the ‘safety net’ that the EU and IMF is providing Greece and “currently there’s no indication” that Greece will activate the request for it right now. A German official said “no one should doubt that this safety net is ready and will be implemented quickly in an emergency.” Greek bond yields are down a touch but stocks are lower for the 7th day in the past 8. The rest of Europe is higher as is the euro. Don’t be surprised if the IMF is involved within days. Coincident with the JoC index of industrial materials yesterday rising for a 9th straight day, the implied inflation rate in the 10 yr TIPS has risen to 2.34%, the highest since early Feb. UK PPI rose twice expectations led by a rise in gasoline prices which today hit a record high of 120 pence per litre which is the equivalent of about $6.90 per gallon.

Category: MacroNotes

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