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New fears over eurozone debt

EUROZONE debt concerns rose as Spanish and Italian borrowing costs touched levels that instigated the Irish, Greek and Portuguese bailouts.

Silvio Berlusconi and the Spanish PM cancelled holidays and called emergency meetings to address the new crisis.

Borrowing costs for both countries are rising as investors worry that already low growth prospects will fall further after weaker US figures point to a general economic slowdown. The interest demanded by investors to lend money to Spain for 10 years soared to 6.47pc at one point and in Italy towards 6.27pc, worryingly close to the 7pc threshold that left Greece, Ireland and Portugal in need of emergency funding.