Negative references to Greece are less frequent, while EU officials express unequivocally their desire to support Greece. The changed climate is reflected in a sharp narrowing of the yield spread between Greek and German ten-year government bonds.
The second factor which has contributed to this improvement is the progress made in the implementation of the adjustment programme, particularly in addressing the twin deficits – fiscal and external. This progress is a sign of incipient rebalancing and restructuring in the economy. •  In the fiscal domain, deficit reduction has been remarkable.