So far, but so safe to relax and we are in danger of being pushed to Europe

Portugal denied EU pressure for a rescue operation but markets did not believe them.

Nature at two speeds on the continent were drawn clearly traders on their screens - countries where bond yields are fall (and rise in the price) and those where yields continue their relentless travel upwards where obligations prices fall as investors turn their back on countries financing needs.

Italy and the Spain dislike the concept of "devices" nation, but in terms of funding, they are moving in this direction, join the Ireland, the Portugal and the Greece. Spanish and Italian bonds risk premia were pushed yesterday at their highest levels since the euro was born in 1999.

Sovereign debt crisis becomes a self-sufficient, daytime phenomenon as bond investors refused to believe these Governments claiming political rhetoric from does not need to bail. Their lack of support just exacerbates the problem, the European Central Bank and the international monetary Fund help inevitable.

Without full and credible deficit reduction plans, appearing on politically unpalatable, countries such as the Portugal will be forced into Ireland in reality even more unpleasant to accept a bailout.

By this stage a country facing long-term and permanent damage as it takes even more debt but is supported by an economy struggling to grow or to decline.

At United Kingdom yields gilt 10 years encouraged by once again 3 2pc, continuing the theme of the United Kingdom considered a safe haven. This is partly due to the fact that UK debt has already average maturity 14 years compared to eight in savings in distress and significantly on our credit 80pc is occupied by institutions national as UK pension funds, ready for greater stability on the market.

But we cannot be complacent. Monday with the Agency the responsibility of the budget (TBO) forecasts show that our annual discovered is £ 148. 5bn or 10pc of GDP. Public sector net debt will hit £ 923bn or 61pc GDP.

The fact that investors are comfortable with these record levels of debt is because our policy has changed and we plan credible claims, at least for our annual discovered which is scheduled for the fall to £ 18bn or 1pc of GDP by 2015. However, public sector net debt will continue to rise over the next five years as our annual, although falling, is added to the stack of our total debt exceeded. By 2015, compared to the 923bn £, reach 1.3 trillion of £.

But the powers of market are other obsession tirelessly in Europe are only outstanding here because investors believe our assumptions that budgetary consolidation, reform of welfare and released for the growth of the private sector will make our still precarious equilibrium finance.

For the moment at least, response to serious problems of our own is in our hands, but no sign of convenience by the coalition on our finances and apparent contagion in Europe is rapidly surround us, too.

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Danger signal as UK services optimism plunges

 Shadow Chancellor Ed Balls said the Government was playing a "dangerous game" by launching an assault on public services. 

The latest trends report by consultants BDO said the optimism index fell to 92 from 94.8 in December, signalling trouble in late Spring. "There remains a real risk that the UK could enter a technical recession," it said.

The service sector index accounting for 55pc of output saw the second largest fall on record, dropping to 88.4. "This could spell danger. Any rise in interest rates would derail the UK economy in its current fragile state. It may be that the Bank of England has to consider putting QE [money printing] back on the table as we go through the year," it said.

"The marked decline in optimism is attributed to elevated inflation, weak earnings growth and the erosion of households' real disposable income. This is set against the backdrop of public sector cutbacks," it said.

The findings will further inflame the debate over the pace of fiscal tightening. Shadow Chancellor Ed Balls said the Government was playing a "dangerous game" by launching an assault on public services. "The cuts are too deep, too fast, putting the recovery at risk," he told the BBC.

Yet the Government may not have much room for manoeuvre given the fiscal deficit inherited from Labour and the harsh mood of global bond vigilantes, even if the gilts market has been well-behaved so far. "If someone says it's not as bad as all that, they just don't realize the calamitous position we are in," Ken Clarke, the Justice Secretary, said yesterday.

BDO's output index rose just above the break-even point for expansion to 95.5, led by manufacturing. While industry has been buoyant, growth barely kept pace with the rise in eurozone factories. Sterling's devaluation has so far failed to bring about the step-change in Britain's manufacturing companies that the many economists had expected, hinting at deep structural flaws in the British economy.

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