Greece set to default, EU leaders admit

European leaders last night bowed to the inevitable and conceded Greece is likely to default on its massive debt burden, which would be a first among the 17 countries using the euro, according to reports.

They also raised the possibility of using the eurozone's bailout fund to buy back Greek debt on the markets, meaning sizeable losses for Greece's private investors and reduced debt levels for Athens, the Guardian reports. MORE

Italian and Spanish bond yields soared to post-EMU highs yesterday on eurozone debt contagion fears.

German finance minister Wolfgang Schäuble denied reports Berlin was ready to empower the Europe's bail-out fund to purchase Spanish and Italian bonds pre-emptively on the open market. The move is seen by experts as vital to halt dangerous contagion to the larger economies, the Telegraph reports. MORE

News Corp chief Rupert Murdoch desperately tried to keep alive his bid to take total ownership of British Sky Broadcasting last night, amid fresh allegations his newspapers accessed the family health records and bank accounts of Gordon Brown when chancellor and prime minister, the Financial Times reports.

Murdoch has in effect put any deal on hold for up to a year, in the hope this will remove the issue from the political arena and keep the bid alive. MORE

Insurers are to fund a multi-million pound City of London Police unit aimed at tackling the £2bn of annual insurance fraud.

The initial three-year project will see insurers pay around £9m to establish a 35-strong unit, which will include investigations into organised frauds involving crooks that work with doctors and solicitors to fake claims, the Telegraph reports. MORE