The euro currency is dipping further against the dollar on financial markets and has reached its lowest level in four months in Asian trade. The drop comes amid rising worries over Greece's political future.

(Reuters) - Greeks are voting with their wallets and pulling euros out of the banks in fear that their country may leave the European single currency despite the declared determination of EU powers Germany and France to keep Athens in the monetary union.

As financial markets shuddered over the deepening turmoil in Athens on Wednesday, a chorus of skeptical politicians and central bankers from London to Ottawa predicted the euro zone could fall apart soon unless European governments act more decisively to save the currency.

(Reuters) - Greece's president met little enthusiasm from political leaders summoned to a final round of talks on Monday to avert a new election, reinforcing fears the country was firmly on the path to bankruptcy and an exit from the euro zone.

European shares slid and Spanish and Italian bond yields rose as the political deadlock threatened to reignite the euro zone debt crisis. Greek banking stocks tumbled 7 percent.

President Karolos Papoulias has assembled the country's divided political leaders for a fourth and final attempt at piecing together a coalition government. European creditors are watching intently.

The Greek president met first with the leaders of Greece's three strongest political parties around lunch time on Sunday, before continuing his talks with the leaders of four smaller groups that secured enough votes to enter parliament.

From The BBC
Europe central bankers have been openly expressing views on the possibility of Greece leaving the eurozone as its leaders struggles to form a government.

Germany's top banker said it was up to the Greeks to decide, but if they did not keep to their bailout commitments, they would receive no new aid.

Foreign Minister Guido Westerwelle has called for a new approach to spending that boosts growth without increasing debt. He also warned that Greece can expect help from the EU, but only if it sticks to its commitments.

Serbian President Boris Tadic and his challenger Tomislav Nikolic are heading for a run-off with initial results showing Tadic and his Democratic party slightly ahead in presidential and parliamentary elections.

The elections are the first since the overthrow of strongman president Slobodan Milosevic in 2000 in which both leading presidential candidates and party blocs claim to support Serbia's integration into the European Union.

(Reuters) - Greeks angry at years of austerity shrugged off the risk of a euro zone exit and punished their ruling parties, which failed to win enough votes to form a ruling coalition in Sunday's election.

With about 95 percent of the vote counted, conservative New Democracy and Socialist PASOK, who have dominated Greece for decades and are the only two major parties supporting an EU/IMF bailout program that keeps Greece afloat, won less than 33 percent of ballots and only 150 out of 300 parliament seats.

(Reuters) - A victorious Francois Hollande faces a short honeymoon after his election as France's first left-wing president in 17 years, with financial markets eager for clear signals on his policies and how hard he plans to push back against German-led austerity.

The moderate Socialist beat conservative Nicolas Sarkozy with 51.7 percent of Sunday's runoff vote after a bruising campaign dominated by the same anger over economic crisis that has felled 10 other European leaders since late 2009.

EurActiv

Bulgaria passed a new law yesterday night (3 May) allowing the treasury to confiscate private assets that cannot be validated by a legal source of income. The measure marks a further step in the country's attempt to win the EU's confidence in its judiciary system.

Prime Minister Boyko Borissov dramatically thanked Bulgarian MPs for backing the law, saying his government would have resigned if Parliament had not voted the bill.

From France24.com Blogs
Since Nicolas Sarkozy failed to win the first round of the presidential election, Carla Bruni changed her Facebook relationship status from “In a relationship” to “It’s complicated”. She also signed up to an internet dating site. And she’s selling her ballet flats on EBay, in exchange for high-heeled wedge platforms.  At least that’s what the Twitterati like to pretend.

The BBC
The leader of Greece's Pasok party Evangelos Venizelos has said Greece faces a choice between austerity and "mass poverty" in elections on Sunday.

"On Sunday, our people's fate is at stake," Mr Venizelos told the closing rally of his campaign in Athens.

(Reuters) - Once the beacon of Spain's new economic grandeur, the Mediterranean region of Valencia has become a symbol of all that is wrong with the country.

Over the last decade, surfing on a property boom, Valencia spent billions hosting the America's Cup sailing competition and the European Grand Prix motor race, launching Hollywood-style movie studios, and building the biggest aquarium in Europe, a Sydney-style opera house and several museums.

(Reuters) - Thousands of workers across southern Europe protested against spending cuts in annual May Day rallies on Tuesday, before weekend elections in Greece and France where voters are expected to punish leaders for austerity.

Unions in Greece, Spain, Portugal, Italy and France are using the traditional marches to express their anger over an austerity drive across the euro zone, aimed at shoring up public finances but criticized for forcing countries deeper into recession.

Germany's novice Pirate Party has positioned itself for two regional elections next month by fending off accusations of far-right infiltration and picking a defense ministry consultant as its new federal chairman.

Germany's Internet-savvy Pirate Party, which recently won seats in two of Germany's regional parliaments, reshuffled its leadership at its congress in the state of Schleswig-Holstein, where regional elections take place next weekend.

The Spanish economy has logged its second consecutive quarter with no economic growth, meaning that the country is now officially in a recession. Standard and Poor's has also downgraded the country's banks.

The new Romanian government under leftist leader Victor Ponta faces ongoing economic problems. Romania's interim leader has said his new cabinet will be unveiled next week.

The new Romanian government under social democrat Victor Ponta faces ongoing economic challenges and promised to restart talks with international lenders as soon as possible.

German Chancellor Angela Merkel has used a newspaper interview to talk about ways to spur economic growth. But she also insisted that a pact on fiscal discipline agreed by most EU leaders was not up for discussion.

German Chancellor Angela Merkel suggested Saturday the European Investment Bank (EIB) could be strengthened and EU infrastructure funds used more flexibly to help spur economic growth in Europe.

(Reuters) - Romania's left-leaning opposition will try to form a new government after torpedoing the centre-right cabinet in a confidence vote on Friday, the latest collapse of an austerity-minded ruling coalition in Europe.

Like other governments in the European Union, ousted Prime Minister Mihai Razvan Ungureanu's two-month-old cabinet has faced a wave of public anger against plans for spending cuts and tax hikes. Violent protests toppled his predecessor, Emil Boc.

(Reuters) - Spain's sickly economy faces a "crisis of huge proportions", a minister said on Friday, as unemployment hit its highest level in almost two decades and Standard and Poor's downgraded the government's debt by two notches.

Unemployment shot up to 24 percent in the first quarter, one of the worst jobless figures in the developed world. Retail sales slumped for the twenty-first consecutive month as a recession cuts into consumer spending.