Lewis Hamilton says Ferrari is bluffing in 2017 F1 testing

The German led the way on the penultimate day of pre-season running with the fastest time of the two weeks so far, even though he was visibly sandbagging during the morning session with ultra-soft tyres fitted.

It is the third of the seven completed days that have been led by a Ferrari driver, following two for Kimi Raikkonen in the opening week, while Hamilton has topped one and Mercedes team-mate Valtteri Bottas two.

Vettel rejected the suggestion Ferrari is the favourite for the 2017 season, and Hamilton believes its tactics made it tough to know its full potential.

"I think Ferrari are bluffing and that they are a lot quicker than they are showing," he said.

"They're very close to us. It's difficult right now to say exactly who is quicker.

"But they are very close, if not faster.

"Whatever the case, I can't wait to go out and compete. Just a couple more weeks to go."

Mercedes non-executive director Niki Lauda conceded on Thursday the champion team has not hit targets with all of its upgrades for the W08 so far.

Hamilton finished the day second-fastest, 0.328 seconds off Vettel's benchmark on the same compound, while Bottas was eighth following his afternoon focused on long runs.

"It was good to get some laps in this morning with slightly lower fuel," Hamilton said.

"We worked on balance and made quite a few changes. I learned a lot about the car before handing over to Valtteri.

"We were trying to simulate something a bit more like qualifying and the car felt good on lower fuel.

"It's great to feel it come together."

BOTTAS: MERCEDES NOT CONFIDENT

Mercedes has dominated F1 since the turbo-hybrid engine formula was introduced in 2014, with Ferrari's expected challenge last year failing to materialise.

Asked if Mercedes remained the favourite two weeks out from the season opener, Bottas admitted it was "very difficult to say".

"We are definitely not confident that we are in the front," he said.

"We are not kind of, relaxing or being in a comfortable situation at all.

"Other teams have made good progress over the winter, Ferrari is looking very strong, Red Bull can always surprise, even some other teams can be close.

"And who knows what people, are bringing to Melbourne.

"So we are aware that we should not underestimate them and we're not at this point saying that 'OK, we're the number one'."