Italy's borrowing costs hit a new euro-era high

Premier Silvio Berlusconi is to address both houses of parliament on the state of the economy later today (GETTY IMAGES)

Italy's 10-year borrowing costs have hit a new euro-era high amid ongoing fears that Europe's debt crisis could spread to the country.

Premier Silvio Berlusconi is to address both houses of parliament on the state of the economy later today, as Italy's president calls for new measures.

Spain is also under the market spotlight. Prime Minister Jose Luis Rodriguez Zapatero has delayed his holiday by a day to monitor the increasingly bleak scenario.

Yesterday, Italy's borrowing costs spiked 0.19 percentage points to 6.21%, while Spain's rose 0.09 points to 6.34%, a little shy of yesterday's euro era high of 6.45%.

Meanwhile, the Milan Stock Exchange lost 2.1%, while Spain's main index was 0.1% higher.