Germany adds to Greek jitters

Greece's cost of borrowing on the bond markets jumped sharply yesterday after Germany's Finance Minister, Wolfgang Schäuble, called for "a quantified and substantial contribution" from bondholders as a condition for a new aid package from the European Union. In a leaked letter to his eurozone colleagues, Mr Schäuble suggested extending Greek bond maturities by seven years.

Rainer Guntermann, at Commerzbank, noted rating agencies have said a voluntary debt rollover would most likely count as a default and that the ECB has said that in such circumstances it would not accept Greek government bonds as collateral: "With this approach the German Finance Minister is openly clashing with the ECB... [the] meeting is getting even more interesting."