The Portuguese are under some intense pressure to tap EU/IMF funds. The euro fell to its lowest in four months against the US dollar, on deepened fears of a Euro Zone collapse due to its growing debt crisis. Since there are bond auctions scheduled this week in Spain, Italy and Portugal, right now wasn’t the best time for this.
“In short, it is difficult to imagine a more negative backdrop for the upcoming auction” of government debt, said Simon Derrick, chief currency strategist at Bank of New York Mellon (Marketwatch)
The pressure of course comes from Germany and France who want to prevent the bloc’s debt crisis from spreading. To me, the EU leadership just doesn’t get it. If Greece had to get a bailout, and then Ireland had to get one, and now Portugal, they haven’t done a good job of containment. Last time I checked, three organs with cancer equals metastasis. And of course, if Portugal does seek a bailout, the market vultures will go attack Spain’s debt woes.
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