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Bond markets are trying to find their footing this morning after yesterday's weakness extended through the overnight session. News that the ECB may go one step further than yesterday's bond-swap deal and actually allow Greek bonds to be written down in a similar fashion to the upcoming private sector haircuts prompted the move higher in yield this morning and lower in price . 10's approached 2.04 and Fannie 3.5 MBS 103-03 before bouncing a bit in recent moments. The markets's focus is clearly on Europe. This morning's Consumer Price Index data was a relative non-event, as expected, and is certainly not motivating any of the current price action. Volume is following European headlines and European trading. To wit, the first pop higher about an hour before the domestic open came on the announcement...()