“We need to tell markets very clearly — and this must be done soon — that there is no other way forward than the one we're pursuing,” Meister said. Policy makers “must sit tight through the turbulence.”

The additional yield sought by investors for holding 10- year French bonds instead of benchmark German bunds widened 8 basis points to 162 basis points at 2:25 p.m. in Frankfurt. The euro rose 0.3 percent to $1.3526.

In Spain, the newly elected People's Party called for a European agreement to “save” the nation's debt, saying the country can't afford 7 percent interest rates.

Spain sold three-month bills at an average yield of 5.11 percent, more than twice the rate at the previous auction a month ago, and above the 4.63 percent for 13-week bills sold Nov. 15 by Greece, which received a bailout last year. Portugal paid 4.895 percent on three-month bills the following day.

Maria Dolores de Cospedal, the deputy leader of Spain's People's Party which ousted the ruling Socialists on Nov. 20, yesterday called for a euro-region accord to “save and guarantee the solvency” of Spain's 650 billion-euro ($881 billion) debt. Spain can't afford to “continue financing itself at 7 percent,” she said, referring to the yield on 10-year debt that led Greece, Portugal and Ireland to seek EU aid.

Luxembourg's Jean-Claude Juncker, who leads the group of euro-area finance ministers, increased pressure on Antonis Samaras, head of Greece's New Democracy party, to drop his refusal to pledge written support for Greek budget cuts.

Juncker, who met Greek Prime Minister Lucas Papademos today, said Samaras' objection risked derailing the aid payment Greece needs to keep paying its bills.

“Would there be no cross-party agreement, the next disbursement would not take place,” Juncker said.

Samaras says he has told officials from the EU, the International Monetary Fund and the European Central Bank that he has already taken five actions that show his full commitment to the austerity program.

An all-night summit of European leaders in October failed to end the turmoil after producing a pledge to write down Greece's debt, recapitalize banks and strengthen the region's rescue fund.

Underscoring discord among policy makers, ECB chief Mario Draghi criticized governments on Nov. 18 for failing to implement “long-standing decisions” to stem the crisis.

Merkel, who is calling for stronger enforcement of debt and deficit rules underpinning the euro, signaled to Christian Democratic lawmakers at a closed caucus meeting late yesterday that she won't bend in her refusal to back joint euro-area bonds and waver from last month's agreement, according to Volker Kauder, the bloc's floor leader.

“If markets think that the euro is about to break up, they're wrong,” Meister said. “We must tell markets that we are ready to defend the currency, that it has a great future and will become the strongest currency in the world.”

Global partners including the U.S. are urging European governments to stamp out the crisis that's threatening to pull the 17-nation currency union apart, weighing on stocks and threatening to tip the world back into recession.

Euro-area leaders must reach “a momentous deal” toward fiscal and political union by mid-January to save the currency bloc, Credit Suisse said yesterday in a note to investors. “In short, the fate of the euro is about to be decided.”

Bloomberg