EUROPEAN UNION

Debt-burdened Greece drew strong demand for a crucial bond issue on Thursday but paid a steep risk premium that underscored its plea to Germany and other EU partners for support to help lower its borrowing costs.

World stocks slipped on Thursday while the euro held above a recent 9-month low against the dollar as the European Central Bank prepared to announce next steps in stimulus withdrawal after its policy meeting.

Asian shares failed to hold on to their early gains, slipping into negative territory as worries about Greece and the outlook for the global economy made investors cautious.

Greece targeted civil servants, the rich and the church on Wednesday in a sweeping new 4.8 billion euro ($6.5 billion) austerity program designed to secure European help to tackle its crippling debt burden.

The European Union executive will unveil a 10-year plan on Wednesday to boost economic growth, create jobs and help steer the bloc safely out of its worst financial crisis in decades.

Greece's borrowing costs fell to their lowest level in weeks on Tuesday amid growing expectations that the government will announce new austerity measures this week to secure European financial support.

Consumer spending increased slightly faster than expected in January as consumers dipped into their savings amid a small rise in incomes, a government report showed on Monday.

The European Union's top monetary official will visit Greece on Monday to discuss the country's economic and financial situation, two weeks before an EU deadline for Athens to show results in cutting its deficit.

Greece must take further measures to reduce the deficit or it will face sanctions, Eurogroup chairman Jean-Claude Juncker was quoted as saying by a Greek newspaper.

The Greek crisis has likely delayed euro adoption for the biggest emerging European economies by at least a year, a Reuters poll showed on Wednesday.

Greece may decide that more measures to cut the deficit are needed after discussing its fiscal situation with visiting European Union inspectors, the finance minister said on Tuesday.

Commerzbank said it expected 2010 to be a difficult year after posting a worse-than-expected fourth-quarter loss, hit by weak trading results and higher loan loss provisions.

The German finance ministry has said that countries using the euro currency will together provide aid worth between 20 and 25 billion euros ($27.2 and $34 bilion ) for Greece, the German weekly magazine Der Spiegel reported on Saturday.

Should Germany ride to Greece's rescue if it can't even provide for its own?

Setting up a European fund to help Greece is not a solution to Athens' debt problems, a German Finance Ministry spokesman said on Monday, dismissing an idea that has been discussed in Germany.

Greece faced down pressure from euro zone peers to step up budget cuts and stem a looming crisis in its debt markets on Monday, as the Brussels again questioned its past reporting of public finances.

Eurogroup Chairman Jean-Claude Juncker warned on Saturday against a further drifting apart of euro zone economies in an interview with a German newspaper.

The fragility of the euro zone economy and public finances underline the need to extend and strengthen euro-wide economic management, European Central Bank Governing Council Member Mario Draghi said on Saturday.

European Union leaders will lay the foundations for a financial bailout of Greece at a summit in Brussels on Thursday, but any package will demand deep fiscal and economic adjustments by Athens in return.

European governments are considering various options to help heavily indebted Greece in what would be the first rescue of a euro zone member in the currency's 11-year history.

Euro zone countries held intensive talks on Wednesday on a possible rescue for Greece, whose debt crisis has shaken the entire currency union, as civil servants staged the first big strike against Athens' austerity plans.