This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Portugal Official Says His Country Needs A Bailout

BARRY HATTON

LISBON, Portugal (AP) â¿¿ Portugal's finance minister said Wednesday his country needs a bailout because of its high debts and difficulty raising money on international markets.

Fernando Teixeira dos Santos said in written comments to daily Jornal de Negocios that "I believe it is necessary to resort to the financing mechanisms available in Europe."

Portugal would become the third financially troubled eurozone country after Greece and Ireland to accept assistance from Europe's bailout fund and the International Monetary Fund. Analysts expect Portugal will need up to ⿬80 billion ($114.4 billion).

The move had long been expected as Portugal, one of the 17-nation eurozone's smallest and weakest economies, struggled to finance its economy ahead of what is forecast to be a double-dip recession this year.

Portugal's prime minister was due to make a televised statement at 8 p.m. (1900 GMT, 3 p.m. EDT).

Market confidence in Portugal's financial future has evaporated over the past year as investors bet the country will not be able to manage its debt load on its own. The yield on its 10-year bond, for example, rose to a new euro-era record of 8.78 percent Wednesday.

Even Portugal's short-term borrowing rates are much higher than what it would likely have to pay for bailout loans as the yield on five-year bonds is now 10 percent. By contrast, Irish average interest rates â¿¿ currently under review for a decrease â¿¿ are 5.8 percent for loans with longer maturities.

Over the past year, Portugal has insisted it doesn't want assistance because the terms of a big loan would lock it into austerity measures for years, lowering the standard of living in what is already one of western Europe's poorest countries. Athens and Dublin were reluctant to accept help for the same reasons.

But authorities have been cornered by the crisis. Rating agencies have downgraded Portuguese bonds to near junk status in recent weeks as new figures showed its debt load is worse than initially thought.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG

Markets

DOW 18,232.02 -53.72 -0.29%
S&P 500 2,126.06 -4.76 -0.22%
NASDAQ 5,089.3620 -1.4320 -0.03%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs