German Chancellor Angela Merkel and French President Nicolas Sarkozy will outline a joint position to solve Greece's debt crisis when they arrive in Brussels for a summit convened to stamp out contagion in European bond markets.

The pact was agreed on after a seven-hour meeting in Merkel's Chancellery in Berlin that ended after midnight, according to a statement distributed to reporters. Merkel and Sarkozy “listened” to the views of European Central Bank President Jean-Claude Trichet, who was also present, though the statement didn't say if they settled differences on whether Greece should be allowed to default.

European Union officials will follow a two-pronged approach today, focusing on the need to agree on a second bailout for Greece and measures that stop the debt crisis engulfing Italy and Spain. Greek options include funding a rescue using a bank tax, allowing investors to roll over Greek debt, cutting the interest rates on outstanding bailout loans and managing a bond default.