There were many wranglings and rows with Europe during the Thatcher era and when John Major took the reins of power little changed. The desire for closer links on foreign policy, military and criminal justice became the new battlegrounds but when it came to the crunch even he chose not to veto the Maastricht Treaty that created the EU. Now the area of conflict is financial integration, with Mr Cameron vetoing a plan for closer fiscal union between eurozone nations.

He believes that there would not be sufficient safeguards to ensure that UK interests were protected over the single market financial services. For example, he wants to make sure there is no EU-wide Financial Transaction Tax - known as the Tobin tax - brought in by the EU, which would damage the City of London. Mr Cameron has pledged that there would be a referendum in the UK before any 'significant' transfer of power from London to Brussels. But while the veto is about the single currency, last night's move validates the UK's position on the margins of Europe. The problem now is that world markets were looking for signs of unity and stability in a club floundering over the eurozone crisis.

Mr Cameron's move has sent a completely different message. The treaty that he has refused to support was designed to bring about greater integration of economic and fiscal policies across the EU, including a requirement for member countries to balance their budgets or be in surplus - a requirement that must be enshrined in national law. Other changes to the treaty would see possible sanctions for countries that go into deficit of more than 3 per cent, a requirement that EU states provide 200 billion euros to the IMF within 10 days and the European stability mechanism - its bailout fund - to become active next year.

But before Nicolas Sarkozy makes too much of the PM's desire to put national interest over that of the European bloc he should remember that one of his predecessors, Charles de Gaulle, twice vetoed the UK's proposed entry into the then European Economic Community.

- PM declares: 'I had to pursue Britain's interests... I effectively wielded the veto'

- French President Sarkozy says Cameron's demands were 'unacceptable'

- London Mayor Boris Johnson says PM had 'played a blinder'

- Lib Dem MEP accuses Cameron of 'betraying Britain'

- Only UK and Hungary certain to stay out of new grouping - and Sweden and Czech Republic may join them in two-tier EU

- After 10 hours of talks 17 Eurozone members and six other countries decide to go ahead with a 'fiscal pact'

- City analyst: 'The PM was never going to throw away the advantage the UK holds in financial services, and thank goodness. In the boom times financial services account for one in six pounds collected in tax'

- Rise in Italian and Spanish bond yields this morning

David Cameron was this afternoon returning from Brussels after sparking a furious debate over Britain's future in the European Union by refusing to sign up to a treaty to save the single currency. After 10 hours of talks last night, the Prime Minister risked isolation in Europe by wielding Britain's veto to block a new treaty designed to restore economic stability by imposing tougher fiscal discipline on the 17 euro states.

At least 23 - and possibly all 26 - of the other member states are now going ahead with their own agreement on a new 'fiscal compact'. The Prime Minister entered talks in Brussels promising 'safeguards' to ensure Britain's influence and sovereignty were not diminished by any agreement to save the euro. Key to his demands was that any transfer of power from a national to an EU regulator on financial services could be vetoed by the UK. He wanted to prevent any EU action that would harm Britain's ability to operate its own regime of regulation for financial services.

Mr Cameron's deployment of the veto was hailed by jubilant Tory eurosceptics, some of whom made clear that they regard it as the first step towards a looser relationship with the EU, or even outright withdrawal. One MP hailed him for showing 'bulldog spirit'. Senior Liberal Democrats in the coalition, including Deputy Prime Minister Nick Clegg, insisted they supported Mr Cameron. But there was dismay elsewhere in the party, with MEP Chris Davies accusing the Prime Minister of 'betraying Britain'. Mr Clegg said he 'regretted' the failure to reach agreement overnight, but insisted that the coalition Government was 'united' on Mr Cameron's demands for safeguards to protect British interests.

French president Nicolas Sarkozy said Mr Cameron had made 'unacceptable' demands for exemptions from certain financial regulations in return for joining in the 'fiscal compact' enshrined in the treaty change. 'We were not able to accept because we consider quite the contrary - that a very large and substantial amount of the problems we are facing around the world are a result of lack of regulation of financial services and therefore can't have a waiver for the United Kingdom,' said Mr Sarkozy.

Read more: http://www.dailymail.co.uk/news/article-2071952/Eurozone-crisis-David-Cameron-vetoes-EU-treaty-save-euro.html#ixzz1g3Ixfj29

But not only does Mr Sarkozy refuse to acknowledge the PM, he actually does a swift swerve aside, waving pointedly to someone - anyone - on his right. Mr Cameron, roundly snubbed, uses the rejected hand to give Mr Sarkozy a seemingly affectionate - if awkward - pat on the shoulder, and moves on, head held high, with a pained smile fixed to his face.

Mr Sarkozy's snub came after all-night talks in which the leaders of the 17 countries that use the euro, plus six others, agreed to a new treaty enforcing stricter budget rules seen as crucial to solving Europe's debt crisis. Efforts by Germany and France to persuade all 27 EU countries to agree to treaty changes failed, in large part because of Mr Cameron's refusal to give up some of Britain's powers.

Mr Sarkozy laid the blame for the failure squarely at Mr Cameron's feet. Speaking shortly before dawn, after what he called a 'difficult' night, he said: 'David Cameron made a proposal that seemed to us unacceptable, a protocol to the treaty that would have exonerated the United Kingdom from a great number of financial service regulations.'

Mr Cameron defended his stance. 'What was on offer is not in Britain's interest so I didn't agree to it,' he told reporters in Brussels. 'We're not in the euro and I'm glad we're not in the euro. We're never going to join the euro and we're never going to give up this kind of sovereignty that these countries are having to give up.'

An agreement on fiscal discpline is considered a critical first step before the European Central Bank, the International Monetary Fund and others would commit more financial aid to help countries like Italy and Spain. Even after the long-awaited deal, watched by governments and markets worldwide, the European leaders have huge hurdles still ahead. They are meeting again later today to work out what exactly their new treaty will contain and how violators of its strict budget rules will be policed. They want it written by March.

Asked repeatedly by reporters whether the transfer of powers to Brussels contained in the deal would provoke a referendum in Ireland, the country's prime minister, Enda Kenny, refused to comment, saying only that the question first required a consultation with the attorney-general. However, Irish Europe minister Lucinda Creighton this morning told Reuters that it was a toss-up whether a vote would be necessary. "I would say it's 50-50 and we will be looking at the detail over the next couple of weeks," she said.

Elsewhere in the eurozone, Dutch Prime minister Mark Rutte insisted to reporters that a referendum in the Netherlands - where a referendum on the European Constitution in 2005 delivered a surprise No vote - would not be needed, as it concerns "no big new deals" but only "the cap-stone in the construction of the euro." However, other parties in parliament upon which Rutte's liberals depend, have other ideas.

Austrian officials have also indicated that the creation of a fiscal union would require a referendum. Outside the eurozone, Romanian Prime Minister Traian Basescu told reporters in Brussels that the treaty would need a supermajority in the parliament and approval in a popular plebiscite. Meanwhile, Denmark's new social democratic prime minister, Helle Thorning-Schmidt, did not want to speculate about Danish constitutional problems related to participation in the new treaty, but leaders of the other two parties in her governing coalition were quick to say that a referendum might be needed.

The Latvian government for its part has signed up to the treaty deal, but it only takes 50 members of the 100-seat parliament to demand a referendum on any major alteration of treaties. Elsewhere, the Czech Republic does not need a referendum for the changes, but the state is home to the bloc's most eurosceptic president, Vaclav Klaus.

Meanwhile, although Finnish Prime Minister Jyrki Katainen said that a treaty change is "not a problem for Finland," the constitutional committee of the parliament has found that a replacement of unanimity by majority voting in the governance of the EU's bail-out funds could result in Helsinki being forced to pay out significant sums without the chamber having any say. As a result, the committee ruled that such a shift would be unconstitutional. A Finnish official told EUobserver that it would be "impossible" for the government to negotiate this problem away.

Europe on Friday awoke to a changed world. The European idea as we know it is in the process of dissolving into thin air. The monumental postwar project of a peacefully unified continent where all member states hold hands in friendship collapsed overnight. The European Union has divided itself in the face of crisis. On the one side is the common currency union, which is following the Franco-German desire to grow together as a way to finally get the euro crisis under control.

On the other side is the United Kingdom, standing petulantly alone, no longer wanting to play.

It is a decisive development - and one that is completely new for Europe. The EU had become used to late night compromises, last minute quasi-agreements that take into account the sensitivities of all member states. That form of accord, one based on finding the lowest common denominator, no matter how low or well-hidden it might be, is finished. When it comes to money, friendship is secondary.

One could also formulate it differently: Europe is finally becoming candid. The crisis is forcing EU leaders to finally bid farewell to all those rituals and hypocrisies that have defined Europe in recent years. Isn't it, after all, true that the British have been the fly in the European soup for quite some time now? They always wanted to be there, to have their say and wield their influence. But when it became time to really engage in Europe by joining the euro, the response was: "No euro please, we are British!"

Europe, though, can work fine without the British. But what kind of future does Great Britain have without the Continent and without the euro? Will it, in the future, focus exclusively on its alliance with the United States? Will the Commonwealth become a greater priority? What is this small country's role in a world made up great powers such as China, Russia, Europe and the US?

These are the questions that Britain must now answer. And it doesn't have much time. If the Brits wait too long, history will simply move on. Should that happen, it would be "bye bye Britain."

"Forever."

It is part of the ritual of long nights of negotiations in Brussels that everyone perceives him or herself as the victor afterwards. So there was little surprise when British Prime Minister David Cameron stepped before the cameras on Friday morning and spoke of a "tough but good decision." He said he had defended Great Britain's national interests. At the same time, German Chancellor Angela Merkel and French President Nicolas Sarkozy praised the decisions taken on Thursday night and Friday morning as important steps towards stabilizing the euro zone.

But neither side can truly be pleased with the results. European Union Commissioner Gunther Oettinger, who is Germany's representative in the EU executive, conceded this as well, noting it was a "good, second-best solution." Instead of a legally clean amendment to the Lisbon Treaty that establishes the operating rules for the European Union, a separate treaty will now be forged between 23 EU governments that have agreed to stricter budget oversight. The agreement has been reached between the 17 euro-zone countries. Nine countries that are not part of euro zone also signalled in the summit's closing statement that they would consult their paraliaments about the possibility of joining the pact.

Britain now stands alone in its rejection of the changes. Initially, Hungary had expressed reservations, but it shifted and joined the majority of European countries on Friday. Hungary, Poland, Sweden, Denmark, Bulgaria, Romania, Lithuania, Latvia and the Czech Republic must still consult their parliaments, before it will be certain just how many members the new fiscal union will include.

The United States and Israel have not ruled out military action against Iran's nuclear facilities if diplomacy fails to resolve a dispute over a program they suspect is aimed at developing atomic weapons. In Washington on Thursday, US President Barack Obama said the United States was considering all options on Iran and would work with allies to prevent Tehran from acquiring a nuclear weapon. "No options off the table means I'm considering all options," he said.

Sanctions and diplomatic pressure still appear to be Washington's preferred course of action. But Israel has been sending mixed signals, unnerving Iranians. Shouting above the clanking hammers of coppersmiths in Tehran's busy bazaar, nut seller Ali encouraged his customers to hoard his wares: "Buy and store! War is looming!"

Tensions with the West rose after hardline students stormed two British diplomatic compounds in Tehran last week in protest against new sanctions imposed after the UN nuclear agency suggested that Iran was pursuing nuclear weapons. Britain closed its embassy and France, Germany, Italy and the Netherlands recalled their envoys. The diplomatic exodus, swollen by some foreign businessmen based in Tehran, has heightened nervousness in the capital to a level not felt since the outbreak of war with Iraq in the 1980s, or the turmoil that preceded the 1979 Islamic revolution that toppled the US-backed Shah.

Twenty-three of the 27 leaders agreed to pursue tighter integration with stricter budget rules for the single currency area, but Britain said it could not accept proposed amendments to the EU treaty after failing to secure concessions for itself. After 10 hours of talks, all 17 members of the euro zone and six countries that aspire to join resolved to negotiate a new agreement alongside the EU treaty with a tougher deficit and debt regime to insulate the euro zone against the debt crisis.

"Not Europe, Brits divided and they are outside of decision making. Europe is united," Lithuanian President Dalia Grybauskaite said on arriving for the second day of a crucial crisis summit, the eighth this year. European Central Bank President Mario Draghi called the decision a step forward for the stricter budget rules he has said are necessary if the 17-nation euro zone is to emerge stronger from two years of market turmoil.

"It's going to be the basis for a good fiscal compact and more discipline in economic policy in the euro area members," Draghi said as he left the summit. "We came to conclusions that will have to be fleshed out more in the coming days." Active ECB support will be vital in the coming days as markets were initially spooked by the split in Europe, and by the prospect of potentially lengthy and uncertain negotiations on a new treaty.

"I don't trust Spain will remain in the euro zone," said Jenaro Garcia, founder and chief executive officer of Madrid based Grupo Gowex, which provides Wi-Fi access in 15 countries. "We moved our cash and deposits to Germany because Spain will come back to the peseta." European companies spent billions preparing for the euro when it was introduced in 2000 by 11 countries. Contingency planning for an unraveling of the currency involves cutting investment, moving money to Germany, transferring headquarters to northern Europe from southern, and even going out of business, according to interviews with more than 20 executives.

The Bundesbank, Germany's central bank, registered capital inflows of 11.3 billion euros ($15 billion) from non-banks in September, according to the breakdown of its current account published November 9. That helped transform a deficit of 47.3 billion euros in Germany's balance of other capital flows in August to a surplus of 700 million euros in September. In another bid to end the debt crisis, European leaders added 200 billion euros to their war chest and tightened anti-deficit rules in what they called a "fiscal compact" at a meeting in Brussels. European stocks dropped and the euro was little changed as the plan disappointed some investors.

"How do you control an explosion in a controlled way?" Fiat SpA (F) Chief Executive Officer Sergio Marchionne told reporters in Brussels on December 2. "That's a contradiction in terms. This will be an implosion of some size with potentially disastrous consequences." Companies switched gears from preparing for a possible exit by Greece to some sort of currency breakdown after Italian Prime Minister Silvio Berlusconi's government collapsed and 10-year Italian bond yields rose past 7 percent in November.

It was nonsense then and remains so today. There is no Euro crisis, the end of the world as we know it is not imminent - unless Angela Merkel and Nicholas Sarkozy pull off their sinister scheme for full European fiscal union on the back of what is nothing more than an entirely contrived and artificial crisis. If Monti expected to walk on to the world stage and win the Oscar for fiscal probity, then he has been rudely disappointed.

Perhaps, but I have strong doubts if that is the real story. Something really big is cooking which may lead to A TOTAL REVOLUTION IN THE USE OF MONEY - first in Italy, then across Europe - buried away in the small print of the fabulous austerity project, which we examine in a moment. My impression is that the Monti cabinet is charged with nothing less than a massive laboratory experiment performed on real live people to see if it is actually possible to effectively demonetize an entire nation. Let me explain what I mean.

A few days back I put up a post warning that fiscal fascism might well take as its first priority THE ELIMINATION OF READY CASH FOR THE VAST MAJORITY OF ITALIANS. Behold, it has come to pass: The Monti administration proposes to outlaw any transactions in excess of 1,000 euros that are performed in cash. Well, it's not so much of a proposal as a diktat which comes into immediate effect. The prime minister is a former advisor to Goldman Sachs, which as we all know is to Bilderberg what the sun is to our solar system.

A constant goal of Goldman Sachs (aka Wall Street, the ECB and the City of London) IS TO CONTROL AS MUCH AS POSSIBLE OF ALL MONEY IN FREE CIRCULATION. Since banks circulate electronic money, this leaves only one alternative possibility for reflation. And that of course is the money in the form of notes and coins which passes between ordinary individuals and their daily activities. Capture that and there is no need for the bankers to bother with reflating their balance sheets by using money borrowed from the markets, or each other, at inordinate interest rates.

I have made the point already that the Monti administration looks very much like a trial run in itself for future outings in like style elsewhere in Europe, and possibly even the United States, Canada, Australia and New Zealand. For the moment we have an experiment in demonetization which as far as I can see has no modern precedents in the capitalist world. Demonetization, assuming that it survives the initial hurdles, has significant social consequences. IT EFFECTIVELY LICENSES ACCESS TO READY CASH. It acts as a form of social manipulation because of the intimacy between banks, the international financial oligarchy and large powerful bodies such as the European Union. It is part of the unfolding destruction of civil liberties and private freedoms that flowed from 9/11.

IT MEANS THAT THE BANKS CAN, EFFECTIVELY, OWN AND EVEN CONFISCATE PRIVATE EARNINGS AND DEPOSITS. Of course seizing control of cash transactions will also avoid the drastic run on the banks which is now occurring in the Bilderberg/Goldman Sachs province called Greece. What is happening in Italy, and will shortly be copied in Greece, is part and parcel of the Sarkozy-Merkel project of MANUFACTURING AN ARTIFICIAL CRISIS IN ORDER TO ENFORCE FULL FISCAL UNITY ON THE EUROPEAN CONTINENT.

In the end, that is all about the digitalization of money, the second kick-in from the demonetization process. Real money will cease to exist as a tangible presence in your pocket or purse. Instead you will have something like a pocket phone to make every transaction, no matter how small, like a beer or a coffee in a bar. YOU CAN RECHARGE - AS YOU ARE PERMITTED - BY THE CENTRALIZED COMPUTER.

Isaac Asimov (science fiction writer) must be looking down on all this with abject fascination.

US officials have acknowledged the loss of the unmanned plane, saying it had malfunctioned. However, Iranian officials say its forces electronically hijacked the drone and steered it to the ground. BBC security correspondent Frank Gardner says the intact condition of the Sentinel tends to support their claim. Iran's Press TV said that the Iranian army's "electronic warfare unit" brought down the drone on 4 December as it was flying over the city of Kashmar, about 140 miles (225km) from the Afghan border.

High-flying and hard to detect, America's RQ-170 Sentinel plane is the perfect stealth drone for peering into another country's secret sites without being caught. One was used in May to feed back live footage of the US Navy Seal raid on Osama Bin Laden's compound in Pakistan. So it is probably not the sort of hardware the CIA would ever like to fall into the hands of the Iranian Revolutionary Guards Corps.

Opinion is divided on how the drone fell into "the wrong hands" and indeed what it was doing inside Iran. But speculation is rife that this particular aircraft was flying deep inside Iran to gather intelligence and real-time video footage of Iran's nuclear sites. This affair is both a political embarrassment and an intelligence setback for Washington.

The Escudo and the Peseta would fall by 50%, and the Lira and the Punt by 25%. Germany would suffer a "deflationary shock". The whole eurozone would crash into depression, with a GDP contraction of around 9% in 2012 - Germany (-7.4), France (-9.1), Portugal (-12.7), Greece (-13.1). Outside: UK (-5), Poland (-6.6), US (-0.2), Japan (-1.1). The price of oil would drop to $55 a barrel. The US would flirt with deflation. The contraction would continue into 2013, before gradually stabilizing.

"Events of the past year have proved beyond doubt that the Eurozone is far from a textbook 'optimal currency area'. But this is an omelette that cannot readily be unscrambled ," said ING's Mark Cliffe. Oddly enough, I lunched with Mr Cliffe days before the ERM blew up in September 1992, so this all has a funny feel to me. His report is less dire than a UBS note predicting a 50% collapse in peripheral GDP, and 20% to 25% in the core, but it still begs the question:

If the intra-EMU currency misalignment is so extreme that free floats would cut Greece by 80%, and Spain by 50%, it surely validates the eurosceptic argument that monetary union has become a preposterous and unworkable arrangement. It will take hideous contortions to hold the system together for year after year if ING is close to right on these numbers, with perma-slump, endless austerity, and ever greater macro-economic absurdities, so why persist? Be that as it may, ING's Mr Cliffe does not agree with those who think the D-Mark will soar against the dollar after a break-up, mimicking the Swiss franc. It will be sucked down by depression and mayhem.

The report does not address the proposal of ex-BDI chief Hans-Olaf Henkel: that Germany and the Kaisertreu should leave EMU to the Latins, orchestrating an orderly North-South divorce. Many readers point out that this would be impossible to carry out. The moment anybody got whiff of such planning, there would be an instant run on the banks and sovereign debt of the southern bloc. So yes, those readers are right. Even German withdrawal would be absolutely bloody. There is no clean way out of this.

The question is which do you prefer: a horrible end, or endless horror?

Millions of Egyptians have flocked to the polls in recent days to elect parliamentary representatives, whose primary role is to appoint a special body tasked with drawing up Egypt's first post-Mubarak constitution. But after initial results indicated that political Islamists will form a majority in the new chamber, the military has moved swiftly to rein in their powers and ensure its own well entrenched political and economic privileges remain intact under any future civilian government.

In a rare interview with foreign media, Major General Mokhtar el-Mulla - a leading member of Scaf - said the upcoming parliament would not be representative of all Egyptian people, and that those appointed to write a fresh constitution must also be approved by the interim cabinet and a newly-created "advisory council" of intellectuals, civilian politicians and media personalities, both of which fall under the control of Scaf.

"This is the first stage in our democracy," said Mulla, who also insisted that details of the army budget must remain shielded from democratic oversight, even after the generals return to their barracks. "In the future, parliament may have the ability to do whatever it likes. However at the moment, given the unstable situation, parliament is not representing all the Egyptian people."

"This is not out of mistrust of the parliament," he continued. "What we are seeing is free and fair elections ...but they certainly don't represent all sectors of society."

That's really the key to understanding the German psychology on the euro. In America, we keep asking why they don't join with the European Central Bank to end the run on the European periphery. The answer is simple: they don't want to end the run on the European periphery. To them, the run on Italy and Greece and Portugal and Spain is a feature, not a bug. It's leverage, and they want to use it. Look how much it has already gotten them. Greece, Portugal, Italy and Ireland are working their way through stringent deficit-reduction plans.

The widely disliked governments of Greece and Italy, which proved unequal to the task of fiscal reform, have been toppled. There is a good chance that the euro zone might become what Germany has always wanted it to be: a fiscal union, in which the members meet their deficit targets and reform their labor markets. And none of this would have happened without the markets making their run at the European periphery.

So to understand the German position, look at it from their perspective: Why in the world would Germany let up the pressure now? When they're so close to amending the very treaty underlying the euro zone? When France has joined with them on a set of reforms? When the market is doing what the Germans never could? I worry this makes the Germans sound like puppetmasters. They're not. Many of their intended reforms are very sensible. The flaws they point to in the euro zone are, indeed, deep, structural flaws in the euro zone. They do envision a future that includes sacrifice on their part: eurobonds that raise Germany's cost of borrowing and a bailout fund - excuse me, a fiscal stabilization fund - that they contribute heavily to.

So my concern isn't that the Germans are selfish and calculating. It's that, without quite realizing it, they have become reckless. They are trying to time the market, betting that they can, in essence, manage the run - that they can do just enough to keep the pressure on without letting matters get totally out of hand. They are like a doctor who, faced with an unhealthy patient presenting signs of a heart attack, demands to see the patient lose weight before they will administer the life-saving treatment.

In almost all of their arguments, the Germans are right. The euro does need to be fixed. But first it needs to be saved. The Germans are betting that this is their opportunity to do both. If they're right, it will have been a remarkable play. If they're wrong, it will have been a disastrous one.

His sinister warning followed the emergence of a secret German plan to build a powerful new economic government for the eurozone and block an EU referendum in Britain. A leaked German foreign ministry memo detailed plans for a new European Monetary Fund. It also claimed the EU's treaty could be altered to centralise more power without triggering a vote. In a further sign of growing German supremacy within the EU, David Cameron was yesterday rebuffed by Chancellor Angela Merkel in talks over how to tackle the euro crisis.

Last night British opponents of the EU were horrified by the bellicose threat to Britain's economic independence. Tory MP Peter Bone said: "I would be happy to have a bet with the German finance minister that the euro will disappear before the pound. It is a completely absurd suggestion that will never happen." Fellow Tory backbencher Douglas Carswell said: "It is a tragedy that a continent of millions of hard-working people is run by clowns like this." And UK Independence Party leader Nigel Farage said: "This German bullying is deeply unpleasant and the sooner we leave the EU the better."

Dr Schauble, who has used a wheelchair since being shot in an assassination attempt in 1990, is nicknamed "Dr Strangelove" in diplomatic circles. In his astonishing outburst yesterday, he insisted he "respected" Britain's decision to remain outside the euro. But he claimed that the UK would ultimately not be able to resist the tide of history. His warning came amid a furious outpouring of anti-British sentiment in Berlin. Top-selling newspaper Bild asked: "What is England still doing in the EU?" while another paper branded Britain "the sick empire".

Dr Schauble's remarks came before the frosty meeting between Mr Cameron and Mrs Merkel in Berlin yesterday. The German Chancellor rejected outright Mr Cameron's opposition to a new EU-wide financial tax that would have a devastating impact on the City of London. And she refused to be persuaded by his call for the European Central Bank to support the euro. Money markets took a dip after their failure to agree.

Last night a YouGov poll for Prospect magazine showed 51 per cent of Britons would vote to leave the EU in a referendum while only 32 per cent would vote to stay in.