Talks between bailout inspectors and the Greek government have resumed in Athens after a months-long delays caused by disagreements over austerity measures.

Representatives of European Union institutions and the International Monetary Fund (IMF) returned to Greece after the government gave into demands to maintain painful cost-cutting measures after the current bailout program ends next year and even beyond the current term of the government, which ends in 2019.

Following a long standoff between the EU and the IMF over debt relief and budget targets for Greece, the impasse was finally broken in Brussels last week in a compromise described as "honorable" by Athens.

The Europeans have been at loggerheads with the IMF over the Washington-based lender's demands for easier budget targets and for Athens' mountain of debt to be reduced.

The IMF insists that budget targets demanded of Greece by the Europeans are too ambitious.

But if the Eurozone is going to stick with its plans, then the IMF has demanded what it sees as the necessary tax hikes and pension cuts to meet them before it will lend further to Athens.

The deadlock has spooked markets with fears of a return to the crisis two years ago when Greece nearly crashed out of the euro, the European single currency.

Athens needs the latest tranche of bailout cash to meet seven billion euros of new debt payments in July or risk defaulting on its loans.