BRUXELLES - Although the precise terms of the rescue deal announced by caretaker prime minister José Sócrates will not be agreed for another two weeks, news of the deal sent the euro rallying on Wednesday. Portuguese bond prices also recovered some ground in early trading, while shares on the Portuguese stock market moved higher in the face of a widespread sell-off across Europe.The interest rate paid by Portugal for the rescue package is expected to be agreed at a gathering of EU ministers on 16 and 17 May. Sócrates resigned in March after the Portuguese parliament rejected his austerity programme. However, like Greece and Ireland, Portugal will have to accept significant cutbacks and tax rises in return for outside help. Jenkins said: "The prime minister in his television address set out a few things the package did not include, so no cuts to minimum wages or public sector pay, no public sector dismissals and no change to the retirement age. But he was short on what measures the package did include, though it is expected to include further privatisations, recapitalisation of the banks as well as a combination of government spending cuts and tax increases."Portugal successfully auctioned €1.1bn of three-month government bonds on Wednesday morning, slightly more than it was expected to sell. However the yield, or interest rate, on the debt rose to 4.652%, up from 4% in a similar auction.The yield on its 10-year debt fell on Wednesday, in response to the bailout deal, to around 10.06%. This level is still generally seen as unsustainable, and is also several percentage points higher than the interest rates levied on Ireland and Greece's own rescue deals.The euro rose to around $1.4854 against the dollar, and also traded above 90p against the pound.
Access Investments-Building Awareness - European Union-ROMANIA
Wednesday, May 4, 2011
BRUXELLES - Although the precise terms of the rescue deal announced by caretaker prime minister José Sócrates will not be agreed for another two weeks, news of the deal sent the euro rallying on Wednesday. Portuguese bond prices also recovered some ground in early trading, while shares on the Portuguese stock market moved higher in the face of a widespread sell-off across Europe.The interest rate paid by Portugal for the rescue package is expected to be agreed at a gathering of EU ministers on 16 and 17 May. Sócrates resigned in March after the Portuguese parliament rejected his austerity programme. However, like Greece and Ireland, Portugal will have to accept significant cutbacks and tax rises in return for outside help. Jenkins said: "The prime minister in his television address set out a few things the package did not include, so no cuts to minimum wages or public sector pay, no public sector dismissals and no change to the retirement age. But he was short on what measures the package did include, though it is expected to include further privatisations, recapitalisation of the banks as well as a combination of government spending cuts and tax increases."Portugal successfully auctioned €1.1bn of three-month government bonds on Wednesday morning, slightly more than it was expected to sell. However the yield, or interest rate, on the debt rose to 4.652%, up from 4% in a similar auction.The yield on its 10-year debt fell on Wednesday, in response to the bailout deal, to around 10.06%. This level is still generally seen as unsustainable, and is also several percentage points higher than the interest rates levied on Ireland and Greece's own rescue deals.The euro rose to around $1.4854 against the dollar, and also traded above 90p against the pound.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment