Pressure rises as euro debt deadline looms
Europe faces mounting pressure this week to bridge a political chasm running from north to south, and right to left, over how to harmonise economic policy.
While the 27-state European Union is preoccupied by upheaval in Libya going into an emergency summit on Friday, markets are sounding ever more pessimistic about progress within the 17-nation eurozone towards resolving its debt crisis.
They are already on edge over high oil and food prices, with the knock-on effect that has on inflation and the eurozone already has plans for its own special summit in Brussels later the same day.
One major concern will be the decision by Fitch Ratings on Friday to downgrade Spain's sovereign credit outlook at the weekend.
Fitch Ratings is one of the three top agencies assessing borrower reliability and was a prime mover in Greece and Ireland's drift to the edge of the precipice last year.
Fitch moved Spain from stable to negative, with the agency blaming a weak economy, banking woes and big-spending regional administrations.
Fitch also warned that Spain could be punished if another summit on March 24-25 failed to produce a "credible and comprehensive" response to its stated goal of deciding the size, shape and scope of a financial rescue system.
Fitch's rating decision -- and its warning on sorting out the rescue mechanism -- came after EU leaders separated across old political faultlines on the how to solve the bloc's economic problems.
Right-wing leaders gathered in Helsinki, while the left met in Athens Friday and Saturday.
The near 2,500-kilometre distance was more than just symbolic.
One EU source close to negotiations on the "comprehensive" package EU president Herman Van Rompuy is negotiating described it as a "chess game" being played out against the clock.