Hopes for Greece bailout deal rise sharply as Athens gives ground

Creditors view new Greek proposals on pensions and VAT as the most positive move yet in five months of wrangling

Hopes of a deal that would spare Greece from a looming debt default and possible exit from the single currency rose sharply on Monday after the country's European partners welcomed proposals from Athens to cut its pension bill and raise extra money from VAT.

In what was seen in Brussels as the most positive development since negotiations began five months ago, the leftwing government of prime minister Alexis Tsipras showed a willingness to give ground on the two issues that have left it at odds with its creditors.

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