Greece was a offered an extension on its €240bn (£178bn) rescue programme, but Greek finance minister Yanis Varoufakis rejected this as “absurd” and “unacceptable”, according to the FT.
He has until Wednesday night to accept these conditions, but this is the second time in five days talks between eurozone creditors and the Greek government have broken down, so a mutual agreement it is highly unlikely.
Varoufakis told the media he had been prepared to agree to new terms with a four to six month extension, a condition to which the EU regulator is not agreeing.
He said Athens would continue to refuse to implement the existing bailout: “We do not believe it is a programme that can be successfully completed.”
European stock markets were forecast to fall as much as 0.7% today following a retreat in shares in Asia and Japan overnight, as concerns over fresh market turmoil and a bank run in Greece mount.
Yesterday the euro erased losses to trade at $1.1359, according to Reuters, a way off from its 11-year low of $1.10 which it hit on 26 January.
The Greek government insisted it has enough funding to keep the government running for several months, but without the European financial backstop there are concerns it will run out of cash as soon as next month.
Eurozone officials said they would be prepared to meet Greece again at the end of the week, but only if the latter specifically request an extension and showed clear signs of commitment to completing the terms of the current bailout.