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Spain , Italy are not far behind.
Contagion hits Portugal as Ireland dithers on rescue
Telegraph. uk
By Ambrose Evans-Pritchard 10:23PM GMT 15 Nov 2010
The EU authorities have begun to vent their fury against Ireland over its refusal to accept a financial rescue, fearing that the crisis will engulf Portugal and Spain unless confidence is restored immediately to eurozone bond markets.
Spain's central bank governor, Miguel Angel Ordonez, lashed out at Dublin on Monday, calling on the Irish government to halt the panic and take the "proper decision" of activating the EU-IMF bail-out mechanism.
"The situation in the markets has been very negative due to the lack of a final decision by Ireland. It is up to Ireland to take that decision, and I hope it does," he said.
The outburst reflected suspicion at the European Central Bank that Dublin is holding the eurozone to ransom, allowing the crisis to fester until it extracts a pledge from EU officials that it will not suffer a loss of economic sovereignty or be forced to give up its 12.5pc corporate tax rate under any deal.
Confused reports continued to swirl as Irish finance minister Brian Lenihan prepared to meet eurozone colleagues over dinner in Brussels on Tuesday night. Dublin has so far admitted to holding talks over "market conditions" with EU partners but insists that it is fully-funded until June and hopes to calm nerves with €6bn (£5.1bn )of budget cuts in early December.
Simon Derrick from the Bank of New York Mellon said the negotiations over Ireland's bail-out have been astonishing. "The creditors say please take the money, and the debtor says 'we don't want it'. It's very odd."
"Still, the EU is doing the right thing to try to create a fire-wall as quickly as possible. They learned from Greece that once bond yields reach this level they have 10 trading days left to avoid a self-feeding crisis. They cannot allow this to spread to a large country because at that point contagion would become uncontainable," he said.
Contagion has already pushed Portugal to the brink, pushing yields on 10-year bonds to the danger level above 6.5pc. Finance minister Fernado Teixeira dos Santos said the country was at the mercy of global forces and may be forced to call for help.
Contagion hits Portugal as Ireland dithers on rescue
Telegraph. uk
By Ambrose Evans-Pritchard 10:23PM GMT 15 Nov 2010
The EU authorities have begun to vent their fury against Ireland over its refusal to accept a financial rescue, fearing that the crisis will engulf Portugal and Spain unless confidence is restored immediately to eurozone bond markets.
Spain's central bank governor, Miguel Angel Ordonez, lashed out at Dublin on Monday, calling on the Irish government to halt the panic and take the "proper decision" of activating the EU-IMF bail-out mechanism.
"The situation in the markets has been very negative due to the lack of a final decision by Ireland. It is up to Ireland to take that decision, and I hope it does," he said.
The outburst reflected suspicion at the European Central Bank that Dublin is holding the eurozone to ransom, allowing the crisis to fester until it extracts a pledge from EU officials that it will not suffer a loss of economic sovereignty or be forced to give up its 12.5pc corporate tax rate under any deal.
Confused reports continued to swirl as Irish finance minister Brian Lenihan prepared to meet eurozone colleagues over dinner in Brussels on Tuesday night. Dublin has so far admitted to holding talks over "market conditions" with EU partners but insists that it is fully-funded until June and hopes to calm nerves with €6bn (£5.1bn )of budget cuts in early December.
Simon Derrick from the Bank of New York Mellon said the negotiations over Ireland's bail-out have been astonishing. "The creditors say please take the money, and the debtor says 'we don't want it'. It's very odd."
"Still, the EU is doing the right thing to try to create a fire-wall as quickly as possible. They learned from Greece that once bond yields reach this level they have 10 trading days left to avoid a self-feeding crisis. They cannot allow this to spread to a large country because at that point contagion would become uncontainable," he said.
Contagion has already pushed Portugal to the brink, pushing yields on 10-year bonds to the danger level above 6.5pc. Finance minister Fernado Teixeira dos Santos said the country was at the mercy of global forces and may be forced to call for help.
