Spain has been quietly tapping the country's richest piggy bank, the Social Security Reserve Fund, as a buyer of last resort for Spanish government bonds, raising questions about the fund's role as guarantor of future pension payouts, the Wall Street Journal reported today. At least 90 percent of the €65 billion ($85.7 billion) fund has been invested in increasingly risky Spanish debt, according to official figures, and the government has begun withdrawing cash for emergency payments.

More than 2,200 insolvency cases were opened in Latvia in 2012, representing a 30 percent increase over the 1,724 insolvency cases that were launched in 2011, according to Baltic-Course.com yesterday. Of the 2012 total, 61 percent, or 1,365 insolvency cases, were opened against private individuals and 39 percent, or 873, were launched against legal entities. In 2011, 845 private individuals and 879 legal entities were declared insolvent. Read more.

Polish builder Polimex is targeting larger-than-planned cost cuts and will have its debt on track by the end of June, its chief executive said today, Reuters reported. Last month, Polimex clinched a debt restructuring deal with creditors and bondholders under which state industrial agency ARP will buy up to a third of the builder. Polimex has said it would sell non-core assets worth at least 600 million zlotys ($195 million) and cut operating costs at least 300 million by the end of 2015.

German unemployment increased less than economists forecast in December even as Europe’s debt crisis curbed company investment and economic growth, Bloomberg News reported today. The number of people out of work rose a seasonally adjusted 3,000 to 2.942 million, the Nuremberg-based Federal Labor Agency said today. Germany's economy, Europe’s largest, may have contracted markedly in the fourth quarter after the euro area's succumbed to recession, the Bundesbank said on Dec. 17.

Bank lending to companies in the euro zone continued to slump in November, according to official data published today that could raise expectations of an interest rate cut as early as next week by the European Central Bank, the New York Times reported today. In its monthly report on lending, the ECB said today that loans to companies, not including banks, in the 17-nation currency zone fell at an annual rate of 1.8 percent in November, the same rate of decline as in October.

A multimillion-dollar embezzlement case involving Greece's national tourism agency has dealt a new blow to the crisis-hit country's political establishment, the Wall Street Journal reported today. Auditors in December were asked to examine what government officials say is a hole in the agency's books, after an incident involving an allegedly fraudulent check raised questions about possible corruption at the agency. The auditors have discovered a series of improper transactions totaling about €12 million ($15.8 million) and extending back as far as 2003.

Portugal's president sent the 2013 budget to the country's highest court for review, an unusual move that highlights deepening opposition to a two-year austerity drive, the Wall Street Journal reported today. President Aníbal Cavaco Silva, who is the head of state and like Prime Minister Pedro Passos Coelho belongs to the right-of-center Social Democratic Party, signed the budget bill into law on Monday, but expressed reservations the next day.

Sweden’s financial watchdog will stop turning a blind eye to traders who have ignored a rule requiring them to report company bond prices as the regulator seeks to improve transparency in a growing market, Bloomberg News reported today. The Swedish Financial Supervisory Authority will ask corporate debt traders to follow rules similar to those adhered to in the government and mortgage bond markets. That means they must file trade reports including volumes as well as the highest, lowest and closing prices, no later than 9 a.m. the next day.

Elections this year in two of the euro-zone's largest countries—Germany and Italy—cast a shadow over the Continent's politics and complicate needed overhauls of the currency union, the Wall Street Journal reported today. As the euro zone this week enters its fourth year of a debt crisis and the economic woes of Greece and Spain continue apace, much work is needed to heal the Continent's economy and ensure the euro's viability. Italy votes first, on Feb. 24-25.

Euro-area manufacturing output contracted more than initially estimated in December, adding to signs a recession in the currency bloc may extend into this year as leaders struggle to tackle the sovereign-debt crisis, Bloomberg News reported today. A gauge of manufacturing in the 17-nation euro area fell to 46.1 from 46.2 in November, London-based Markit Economics said today. That’s below an initial estimate of 46.3 on Dec. 14. A reading below 50 indicates contraction. The gauge has been below 50 for 17 months.