Morning papers: Euro soars as ECB offers debt deal to Greece

The euro hit a fresh two-month high amid speculation that Greek politicians were ready to yield to the demands of their troika paymasters despite coalition leaders failing to sign off on tough austerity measures, reports The Telegraph.

A meeting of Greece’s ruling coalition ended last night without an agreement, after the party leaders failed to sign off on pension cuts, one of the measures demanded to secure a €130bn (£109bn) bailout .

Chinese inflation jumps to 4.5%

Chinese inflation jumped in January, breaking a streak of five straight monthly declines, but seasonal factors were largely to blame and price pressures were expected to weaken in the coming months, reports the Financial Times.

The consumer price index rose 4.5 per cent from a year earlier, up from December’s 4.1 per cent pace. The main cause of the rebound was a shopping blitz before last month’s Chinese New Year holiday, which pushed up food prices, an effect which has regularly been seen in the past and is likely to be temporary.

Debt investors regain appetite for Europe’s periphery

European investors are buying new corporate debt in Spain and Italy for the first time in months, highlighting how recent measures by the European Central Bank to prop up the banking system have helped to thaw out the eurozone’s beleaguered peripheral bond markets, reports the Financial Times.

Companies including Telefónica, the Spanish telecoms operator, Intesa Sanpaolo, Italy’s largest retail lender, and Irish building materials group CRH have tapped international investors for the first time in months.

Investors debate Italy’s changing fortunes

Prescient or foolhardy? Investors who took a punt on Italian government bonds late last year are already sitting on handsome profits, leaving those who missed out asking whether Italy under Mario Monti’s technocratic government has truly turned a corner, reports the Financial Times.

Analysts are warning, however, that the strong market rally – primarily driven by cheap financing provided by the European Central Bank – flies in the face of expectations that Italy, the most critical element for the survival of the euro, will suffer the deepest recession among advanced economies this year.

Brokers suspended in Libor inquiry

More than a dozen traders and brokers in London and Asia have been fired, suspended or put on leave by their employers as a multinational probe into alleged manipulation of crucial global lending rates accelerates, reports the Financial Times.

Regulators have been investigating US and European banks that help set interbank lending rates in London and Tokyo since late 2010, in an intensive profile inquiry that spans three continents and involves at least nine separate enforcement agencies.

Mis-selling refunds promise to deliver £10bn fiscal stimulus