THE INDEPENDENT: Portugal's cost of borrowing soared by 80 per cent yesterday, as the eurozone's ongoing debt crisis took centre stage again with the festive season barely over.
The Portuguese government successfully sold €500m (£425m) of bonds repayable in six months but the yield – or cost in interest to its taxpayers – was 3.68 per cent. That compares with the 2.04 per cent the country paid for a similar auction in September. The yield was as low as 0.59 per cent as recently as a year ago.
The punitive rates were a reflection of the continued fears that Portugal will be the next domino to fall by following Ireland and Greece in having to seek a bailout from the EU and the International Monetary Fund. The country's Prime Minister, Jose Socrates, has repeatedly said Portugal will be able to continue to finance its debt on the international markets and will not need to take this step, despite the rates it is being required to pay. >>> James Moore, Deputy Business Editor | Thursday, January 06, 2011
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