Belgium’s King urges coalition talks continue

BELGIUM’S King Albert II has told Elio Di Rupo, the man tasked with forming a government, that he cannot resign and must press ahead with coalition talks.

Worries over the country’s deficit are intensifying political crisis in Belgium, which still lacks a government following indecisive elections in the summer of 2010.

Yields on 10-year Belgian debt have surged to over 5.7 per cent, from below 4.8 per cent at one point last week.

Belgian authorities have joined France this week in calling for the European Central Bank (ECB) to step up its role in stemming contagion across the Eurozone.

And there was more bad news yesterday as Belgian business confidence was confirmed as declining for the eighth straight month.

The index’s top line deteriorated to minus 12.2, from minus 10.4 the previous month. The score “is consistent with zero GDP growth year on year over the next quarters”, BNP Paribas said in a note.

Meanwhile pressure on Italian debt was also heightened yesterday, with yields on 10-year bonds rising as high as 7.13 per cent, before closing at 7.11 per cent, up nearly two per cent.