The cost to Spain of servicing its debts hit a critical level on Thursday after the country's latest credit rating downgrade and a blow to hopes of a resolution to the euro crisis.
The interest rate on Spanish 10 year bonds briefly topped 7% - a new euro era high for the country - before slipping back slightly.
It happened shortly after Germany's leader again refused to heed demands for the eurozone's powerhouse economy to ride to the rescue, despite growing pressure from world leaders.
The 7% level is a psychologically significant threshold and prompted stock markets to extend their losses and the value of the euro to drop.
Greece, Ireland and Portugal were all required to request financial bailouts when their respective 10 year bond rates rose above 7%.
It's considered unsustainable by investors, though Italian bonds hit 7% in November 2011 before falling back again and Spain will hope for a similar response from the markets.
In the wake of today's deveopment, Spain's Economy Minister Luis de Guindos pledged action to get its borrowing costs down in the coming days.
The tipping point was reached shortly after Angela Merkel had told the German Parliament that Europe must press ahead with closer political and fiscal integration, appearing to again rule out any immediate intervention.
"It is our task today to make up for what was not done (when the euro was created) and to end the vicious circle of ever new debt, of not sticking to rules," Merkel said.
"I know that it's arduous, that it's painful, that it's drawn-out. It's a Herculean task but it is unavoidable."
She also wants the European Central Bank to a "bigger role" in overseeing banks to avert further turmoil in the industry.
Single currency nations France, Italy and Spain are demanding more immediate action, saying that reforms like euro bonds - which would effectively allow euro countries to borrow money at a single, lower rate - are needed to halt the contagion from Greece.
The German central bank has ruled out greater financial integration without improved fiscal union first.
Germany's position expects to come under siege at next week's G20 summit as those in the firing line of the crisis endure further pain.
Credit ratings agency Moody's downgraded Spain by three notches last night, leaving its bonds one step away from junk status.
Cyprus was also downgraded.
Markets were also underwhelmed this week by the 100bn euro (£80bn) rescue plan for Spain's banks.
There are severe nerves too over the prospect of an anti-austerity vote dominating the Greek election on Sunday, opening up the prospect of a 'messy' exit from the single currency.
Investors lack confidence of progress at next week's G20 summit in Mexico.
Italy completed a planned bond sale today but at a substantially increased cost over worries that it will be next to come under the market microscope.