Spain planning to breach EU budget targets, warns prime minister Mariano Rajoy

Mariano Rajoy, prime minister of Spain, said the budget deficit would be 5.8pc of GDP in 2012 - more than 30pc higher than the 4.4pc target agreed by Brussels.

Europe’s ESM Foresees Bond Clauses, IMF Restructuring Standards

Jan. 20 (Bloomberg) -- Europe’s planned permanent rescue fund may require clauses in new bond issues that would leave the door open for debt restructurings, while deeming writeoffs “exceptional” and subject to International Monetary Fund standards, according to a draft text.

Economy’s Crisis Respite Gives ECB Room to Pause Rate Cuts

Jan. 12 (Bloomberg) -- The European economy may be winning some respite from its sovereign debt crisis.

Eurozone unemployment stays at record high

Unemployment in the eurozone stayed at a record high in November as the impact of the sovereign debt crisis rumbled on, according to official figures.

Euro zone economy heading for steep contraction in Q4: PMIs

LONDON (Reuters) - The escalating sovereign debt crisis has already pushed the euro zone economy into a contraction that could be far worse than economists had expected, business surveys suggested on Monday.

Many similarities in Arab Spring, European chaos

CNN) -- The victory of the opposition Popular Party in Spain's general election means that seven leaders or governments around the Mediterranean have been thrown out within the last year, amid an explosion of popular protest. Several more are fighting for their survival.

RBS takes £142m hit on Greek bond portfolio

The spectre of the sovereign debt crisis cast a pall over Royal Bank of Scotland's third-quarter results yesterday when the bank admitted that it had taken more hits on its Greek bond portfolio and had sold most of its Italian debt.

Euro crisis weighing on east European growth

A major development bank sharply reduced its growth forecast for Eastern Europe on Tuesday and warned of risks to the region’s banks, another example of how the sovereign debt crisis is radiating outside the euro zone.

The European Bank for Reconstruction and Development, which lends to businesses and governments in the former Soviet bloc and is underwritten by Europe and the United States, cut its growth estimate for Central Europe and the Baltics to 1.7 percent for 2012.

Merkel Says EU Summit Will Be Important, Not Final, Crisis Step

Oct. 18 (Bloomberg) -- German Chancellor Angela Merkel said that a European Union summit in five days will mark an “important step,” though not the final one in solving the euro-area sovereign debt crisis.

“These sovereign debts have built up over decades, so they won’t be ended with one summit,” Merkel told reporters in Berlin late today. While European officials recognize their responsibility to stop the crisis, “this will require tough, long-term work.”