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Europe Update: Portugal


This might be an interesting week …

From Marcus Walker at the WSJ: Portugal’s Test of Debt Market Looms This Week

Portugal hopes to raise new funds in a bond auction on Wednesday … European Union governments including Germany and France have for weeks been urging Portugal to apply for rescue loans from the joint EU-International Monetary Fund bailout facility …

the EU’s deliberations over Portugal haven’t reached the intensity seen ahead of the Greek and Irish rescues … That could change quickly, however, should Portugal’s borrowing costs continue to rise. Euro-zone finance ministers are set to meet Jan. 17, by which time the market’s appetite for Portuguese debt should be clear.

The yield on the Portugal 10-year bond is at 7.1%.

If the bond auction goes OK, maybe yields will fall. If not, we might see the ‘intensity of deliberations’ increase next weekend.

• Summary for Week ending January 8th
• Schedule for Week of January 9th

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