Italian prime minister Mario Monti suggested using the European Financial Stability Facility's (EFSF) €440bn rescue subsidy to buy open market peripheral bonds in an attempt to counteract the rising cost of government bond yields in Spain.

“The idea is to stabilise borrowing costs, especially for countries who are complying with their reform agendas, and this should be sharply distinguished from the idea of a bailout,” he said.

Angela Merkel has been opposed to the bailout rescue fund for quite some time, but she found herself under pressure yesterday to commit to a deal, as analysts maintain that borrowing cost levels will soon become unsustainable.

François Hollande said the expenditure was completely unacceptable and thought Europe should look at Italy's suggestion in depth: “We must show a much faster ability to intervene,” he said. “It's not acceptable that Spain which has just got a promise for support, has interest rates around seven percent.”

According to the WSJ, European officials have “welcomed an expansion of resources at the IMF, in the hopes the emergency lender could help contain the fallout from Europe's crisis,” as world leaders outside of the continent wonder if the problems can be solved without its help.

However, Barack Obama said he was positive “bold and decisive” action will be taken.  “I am confident over the next several weeks, Europe will paint a picture of where we need to go,” he told reporters at the end of the summit. “They understand the stakes.”

The ongoing discrepancies have seen a sharp decline in morale across European business. Germany's ZEW index reported the sharpest drops since 1998 yesterday, and the French INSEE index revealed levels were the lowest they'd been since December 2009.  Just before the Greek election, ZEW figures measured the expectations of 350 financial analysts and found 34.1 percent expected the ongoing situation to worsen.