Italy's Premier Mario Monti has warned his country is becoming increasingly hostile to Germany because painful austerity measures it has adopted are not being recognised.

Mr Monti, who met in Berlin today for talks with German Chancellor Angela Merkel, said Italy's economic reforms do not receive the recognition they deserve.

And he warned Italians could turn their back on Germany and the rest of the EU if they do not see austerity measures lead to progress in the country's financial situation.
Disgruntled
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Disgruntled: Italian PM Mario Monti is given a military honour guard as he meets Chancellor Angela Merkel in Berlin this morning

German Support
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Support: Mr Monti told Die Welt newspaper Italian would become increasingly hostile to Germans if painful austerity measures were not recognised

He told Die Welt: 'It is a problem that despite out sacrifices we do not experience any kind of concession by the EU, for example in the form of a cut in interest rates.

'If the Italians do not see concrete rewards for their willingness to save and reform, there will be protests in Italy against Europe and also against Germany which is seen as ringleader of EU intolerance and against the European Central Bank.'

Although Mr Monti's government has adopted debt-cutting reforms, Italy's borrowing rates remain dangerously high.

Italy is a key focus because of its size, huge debt load and need to borrow heavily in the first quarter.

Debt Crisis
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Debt crisis: The two leaders met in Berlin to discuss the euro debt problems

The yield on its 10-year bonds is hovering around the 7 per cent level that is widely considered a danger mark.

Flag Ceremony
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The national flags of Italy and Germany fly over the Reichstag building in Berlin. A European summit on the debt crisis will be held in Rome later this month
Some economists argue the European Central Bank should help Italy more by buying its government bonds on the open market in larger quantities.

That would lower Italy's borrowing rates and ease pressure on its finances.

But the ECB, along with Germany, resist such a move.

Mr Monti's meeting with Ms Merkel is the latest in a series of talks between European leaders.

The German leader met with French President Nicolas Sarkozy in Berlin on Monday and last night with International Monetary Fund chief Christine Lagarde.

Ms Merkel and Mr Sarkozy also plan to travel to Italy on January 20 before a European summit at the end of the month.

European markets reacted to continued gloom over the debt crisis. The FTSE fell 0.72 per cent to 5,655.57, but there was better news in the U.S. as the Dow Jones rose by 0.56 per cent to 12,462.50.