Portugal Inches Closer To Bailout


Following a turbulent week politically, Portugal may now be facing down the barrel of an inevitable bailout from the EU/IMF. Skittish investors dumped Portuguese bonds which has pushed the yield of Portuguese debt to a record 8%. This would see them shut off from the markets the next time they need to raise capital.

Portugal have been reluctant to follow Ireland and Greece down the path of accepting an EU/IMF package, however the current political situation, Portuguese prime minister José Socrates being forced out this week after failing to secure support for a package which would have both reassured the markets and pulled the country back from the brink, will not help to allay fears and brings the reality of a bailout closer.

In a further blow ratings agency Standard & Poor has also downgraded Portugal’s debt by two notches.

I’ll be reporting more on this situation as soon I hear the news….


About Aaron Basile
Market Technician, Equity/Commodity Trader, Austrian Economist, Contrarian Investor

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