Italy under fire as euro debt crisis deepens

FINANCIAL market pressure on Italy intensified last night, sucking Europe’s second biggest debtor nation deeper into the euro area danger zone and prompting emergency consultations in Rome, Madrid and other European capitals.

Italian and Spanish bond yields hit their highest levels in 14 years, with five-year Italian yields ominously touching the same level as Spain’s in a sign that Rome is overtaking Madrid as a focus of investors’ concern about debt sustainability.

Italian economy minister Giulio Tremonti called a meeting of the Financial Stability Committee — made up of representatives of the government, the Bank of Italy, market regulator Consob and insurance authority ISVAP — a day before prime minister Silvio Berlusconi is due to address parliament.