Disputes rage in Europe on eve of debt crisis summit

A FLARE-UP over the European Central Bank and political turmoil in Italy kept the eurozone on edge last night on the eve of today’s summit meant to confront the currency bloc’s worsening sovereign debt crisis.

Just hours before European leaders are due to adopt a plan to reduce Greece’s debt burden, fortify European banks to withstand bond losses and scale up the eurozone rescue fund to prevent market contagion, disputes raged in Rome and Berlin.

German Chancellor Angela Merkel opposed a phrase in a draft conclusion for the summit that calls for the ECB to continue buying bonds in the secondary market, while a meeting of EU finance ministers was cancelled as the details of issues to be discussed had not been finalised.