The European Central Bank, which has cut interest rates the past two months, looks set to hold its fire until it can better assess how effective its previous actions have been.

Last month -- on the same day that EU leaders met in Brussels in what was seen as a make-or-break crisis summit -- the ECB brought Eurozone borrowing costs back down to their previous historical low of 1.0 percent, effectively reversing this year's two earlier rate hikes.

German Chancellor Angela Merkel on Wednesday assured Italy its tough austerity measures would be "rewarded", amid signs her own economy was grinding to a halt as tensions in Eurozone markets simmered.

Capping a flurry of diplomatic activity as leaders strive to stem the crisis that threatens to tip the 17-member Eurozone into recession, Merkel expressed "great respect" for Italian Prime Minister Mario Monti's reform efforts.

Japan gave a boost Thursday to the U.S. campaign to sanction Iran over its nuclear program, pledging to buy less Iranian oil, a day after China reacted coolly to the U.S. effort.

Iran's "nuclear development problem can't be ignored by the world, so from that perspective we understand the U.S. actions," Finance Minister Jun Azumi told reporters after meeting with U.S. Treasury Secretary Timothy Geithner, who was visiting Tokyo after two days in Beijing.

Germany's economy is expected to have slipped into reverse in the last quarter of 2011 in spite of showing an overall growth for the year of 3 percent, the country's Federal Statistics Office revealed Wednesday.

The country's annual growth rate was achieved in spite of the financial crisis in Europe which has other economies such as Greece, Spain and Italy struggling with huge debts.

Debt-crippled Greece's budget deficit is expected to hit 9.6 percent of economic output in 2011, about half a percentage point above target, the development minister acknowledged Wednesday.

Michalis Chryssochoidis said that an increase in the use of European Union structural development funds had contributed to lowering government overspending from 10.6 percent of gross domestic product in 2010.

The gulf between rich and poor and a simultaneous surge in the youth population and that of retirees are among the factors threatening to sew the "seeds of dystopia", a new report warned Wednesday.

The World Economic Forum warned in its Global Risks 2012 report that social upheaval and vulnerability to further economic shocks and risk were undermining the progress of globalization.

The European Union revised downwards on Wednesday its figure for Eurozone growth over the third quarter of last year, to 0.1 percent.

The previous figure given was 0.2 percent and detailed EU data showed that a drop on France's previously published growth rate between July and September, from 0.4 percent to 0.3 percent, impacted the revision in gross domestic product (GDP).

German Chancellor Angela Merkel was due to meet IMF chief Christine Lagarde later Tuesday for talks set to focus on Greece as it races to reduce its debt in a bid to secure more aid.

A day after Merkel hosted French President Nicholas Sarkozy for their first tete-a-tete of 2012, she will press on with an intensive three-day diplomatic push as the Eurozone crisis shows no signs of abating.

Ratings agency Fitch said on Tuesday it does not plan to downgrade France's top triple-A credit rating in 2012 unless the country suffers major economic shocks.

"Fitch maintains its position from December. In the absence of important shocks that could be linked to a strong worsening of the situation in the Eurozone, Fitch does not foresee modifying its negative outlook (on the ratings) before 2013," a Fitch spokeswoman said.

Britain's government on Tuesday approved the construction of a high speed rail network linking London with cities in central and northern England from 2026 at a cost of almost £33 billion.

Supporters of High Speed 2, which will see journey times between London and Britain's second biggest city Birmingham slashed to 49 minutes from around 1.5 hours now, say it will boost Britain's economy in both the short and long term.