The turmoil in world markets intensified today as fears the eurozone will collapse were fuelled by a rise in borrowing costs for some of its biggest members.

GERMAN Chancellor Angela Merkel will seek backing from German lawmakers to bolster the euro bailout fund on the same day she heads to a European summit as banks joust with leaders over the size of losses they take on Greek bonds.

London’s leading shares index fell 4.5% today – the 12th biggest points fall in its history – amid fears the world is sliding into a double dip recession.

World markets continued their rally today after eurozone leaders agreed a new €109bn rescue deal for debt-laden Greece, allaying fears of the collapse of the single currency.

THE pound and the dollar continued to fall against the euro yesterday but small firms will suffer if the euro continues to grow in strength.