The sovereign debt crisis that has been burdening peripheral countries in the eurozone has escalated over fears over Greek financial stability, political turmoil in Spain, and a possible downgrade of Italys credit rating, according to Bloomberg. More than a year after Greece received a 750 billion aid package for Greece,the cost to insure Greek debt against default rose to a eurozone-era high as the government struggles to implement the necessary austerity program to continue receiving international aid. The concern comes on the heels of a sharp downgrade of Greek debt, along with a stern warning from ratings agencies against any form of restructuring of debts.
Meanwhile, Standard & Poors warned that it may cut Italys credit rating. Additionally, questions over the Spanish economic situation were raised anew after Spanish voters dealt a harsh blow to Prime Minister Jose Luis Rodriguez Zapateros Socialist party over austerity policies. The elections have sparked concerns that newly elected officials may reveal the countrys finances to be in a weaker state that was reported by ousted officials. With funding pressure on eurozone countries increasing, the European Union has begun selling 4.75 billion euros of 10-year bonds to raise additional funds for the bailouts of Ireland and Portugal.