Resignation of Portugal's Foreign Minister Rehashes Uncertainty in Europe

July 3, 2013 11:51 AM EDT
The resignation of Portugal Foreign Minister Paulo Portas cause one of the worst political crisis in the country since its receipt of an international bailout two years ago.

The move comes following resignation of the country's Finance Minister Vitor Gaspar on Monday. Portas' resignation was due to disagreement over current austerity measures.

Yield on Portuguese debt soared as a result on concerns that new leadership would seek aid once again and possibly move for a governmental debt restructuring. The Portugal benchmark 10-year bond saw yields rise 1.32 points to 7.76 percent.

The WSJ noted that under Portugal's current bailout plan, the country is expected to wean itself off of euro-zone help and tap private markets again by next June.

Due to an influx of money by central banks on stimulus measures, many skeptics were willing to once again bet on Portugal, which many saw as much less risky now than a few years back. On May 7th, the country conducted its first debt offering since 2011, selling €3 billion with a yield of 5.67 percent. The government said demand was "massive."

The euro is currently up 0.19 percent to $1.3006. Traders are keeping an eye on CurrencyShares Euro Trust (NYSE: FXE).

U.S. markets are mixed today: the Nasdaq and Dow Jones Industrial Average are both up, while the S&P 500 is lower.

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