Germany

Tension between the European Central Bank and the German government has intensified as Jean-Claude Trichet hit back at the German finance minister's claims Greek government bondholders should contribute to a new aid programme.

Germany is urging Greece to extend the maturity of its debt by seven years, clashing with the European Central Bank's view that forcing investors to take a loss could damage the eurozone.

The euro crisis is following a predictable path. The bills have increased greatly, and are being passed around in the hope the problems will go away.

ON EUROPE

The economies of the 17 countries in the single currency block grew 0.8% in the first three months of 2011, up from 0.3% in Q4, figures released today reveal.

ON EUROPE

THE ALCHEMIST

German bond yields are climbing as European leaders consider increasing the €750bn rescue fund to help countries needing bailouts.

The German economy made a strong bounce-back in 2010, growing by 3.6%, according to provisional figures from the national statistics office.

UPDATE 12pm: The FTSE is up a third of a percent and other key European markets have jumped 1.3% on news Portugal has succeeded in raising £1bn in a bonds auction, easing concerns over the country's need for an EU bailout.