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Portugal edges closer to needing a bailout

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Portugal edges closer to needing a bailout

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Portugal’s President, Anibal Cavaco Silva, has been sworn in as leader for a second term. His inauguration took place against a backdrop of his country’s worsening financial crisis.

Although his position is largely ceremonial he has promised to cooperate with Portugal’s minority socialist government in its implementation of a tough, deficit cutting budget.

But the president’s second term began on the day Portugal’s two-year cost of borrowing hit the highest level since it joined the euro, in a bond auction.

Analysts say the yields are unsustainably high without Europe-wide action, which means Portugal is increasingly likely to follow Greece and Ireland in needing a bailout.