The cost of insuring Greek sovereign debt has been pushed to a record high amid fresh fears the indebted country is moving closer to default.
Greek credit default swaps jumped 50 basis points to a high of 1,510bps as crowds protested against austerity measures put before the Cabinet on Thursday. The level means it now costs £1.51m to insure £10n of Greek debt.
Market concerns were compounded by new figures showing Greece's economy slowed faster than expected in the first three months of 2011. The figures put the annual pace of the downturn at 5.5pc rather than 4.8pc as previously estimated as public sector cuts and higher indirect taxes hit the economy.
However, Greek exports, including petroleum products, increased by 31.5pc during the January-March period, according to the Panhellenic Exporters Association.
Experts said the country, struggling under €340bn (£301bn) of debt, was likely to stay in recession in 2011 for the third year in a row.
There were further strikes on Thursday as Greece's prime minister George Papandreou sought to get further austerity measures approved by the Cabinet.
The Telegraph
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