European bonds and stocks traded cautiously on Friday before a Greek referendum on EU-prescribed reforms that could determine the country's future in the euro zone and which polls suggest could go either way.
Yields on top-rated German 10-year Bunds, the benchmark for European borrowing costs, fell as some investors chose to preserve their capital in low-yielding but relatively safe assets. European stocks dipped and were set for the biggest weekly drop in two months, while the euro edged higher.
The moves were marginal, though, as investors did not want to position too heavily on either side.
"The European market is frozen ahead of the Greek referendum," said Markus Allenspach, head fixed income research at Julius Baer.
Supporters of Greece's bailout terms have taken a wafer-thin lead over the "No" vote backed by the leftist government, 48 hours before Sunday's referendum, an opinion poll showed.