IItalian premier Mario Monti has seen nearly seven months of confidence-building efforts by his government wiped out today, when a debt auction revealed that the country’s borrowing rates are back near levels last seen in December.

Spain will force banks to increase provisions against real estate loans by about €30bn and will hire two auditors to value lenders’ assets in a fourth attempt to clean up the industry.

Spain announced deep cuts to its central government budget yesterday as it battles to convince European partners and debt markets it can rein in its budget deficit in the face of growing complaints from the public.

The irony is that Ireland’s recovery is at risk as others follow our approach, write Carmel Crimmins and Gavin Jones

STANDARD and Poor’s added to mounting pressure on Italy yesterday with a one-notch cut to its credit rating that hit eurozone markets and prompted calls for Silvio Berlusconi’s government to resign.