Portugal edges closer to bail-out

Prime Minister Jose Socrates has warned that his government will collapse if it loses a parliamentary vote scheduled for 3pm today.

Opposition parties' rejection of the measures, which include welfare cuts, tax rises and increased public transport costs, could lead to all-out financial meltdown for the country, which has attempted to raise money in the debt markets in recent months. This would in turn trigger intervention from the IMF and widespread unease about the other economies within Southern Europe.

Today's yield on Portugal's 10-year bond is at 7.8%, compared to the more than 8% yield on Greece's bond prior to the latter's financial bail-out.

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• Topics
• Southern Europe
• Portugal