Germany under pressure on debt deals

There are increasing signs that Germany is preparing to change its attitude towards eurozone countries becoming liable for one another’s debts as intense efforts are being made to provide Spain with funding that will not trigger a sovereign crisis.

Pressure on Germany and on the eurozone generally was increased by the G7 conference call that included finance ministers, central bankers and EU economics commissioner Olli Rehn.

Just ahead of a planned trip to the markets by Spain tomorrow, their budget minister broke with the narrative coming from Madrid, saying the cost of borrowing had effectively shut the country out of the markets.