Greece's new leader today submitted a draft budget while Italy has presented an austerity program. But investors are skittish as EU debate rages over how best to address the Europe debt crisis.
Yesterday, investors began dumping bonds, even in stronger economies like Austria and Finland. The sell-off shows a need for bolder solutions to the European debt crisis, say some.
Greek PM Papandreou got the backing of his cabinet to hold a referendum on EU bailout terms. He meets today with France's Sarkozy and Germany's Merkel, who have said renegotiating is not an option.
Referendum to be called in Greece: Prime Minister George Papandreou called for a referendum that may further destabilize the economy in Europe and undermine euro.
As developed economies deal with debt and emerging economies like China ramp up, the G20 must spearhead coordinated, complementary policies to navigate the choppy waters ahead, especially for Europe. Austerity alone won't do the trick.
Stocks drop 1 percent or more on major European indexes because of concerns about Italian debt. Japan limits losses with yen intervention. US stocks expected to open lower.
Interest rates rise to record 6.06 percent for 10-year Italian bonds. High interest rates signal market skepticism that Italy will cut spending and balance its budget by 2013.
Europe debt crisis requires immediate changes for eurozone. But Europe debt crisis has revealed deeper flaws that will be harder to fix.
With German Chancellor Angela Merkel and French President Nicolas Sarkozy at odds over how to leverage bailout funds, hopes for a solution from Sunday's debt crisis summit are wavering.