The Portugal also is in a delicate situation

The European sovereign debt crisis is shaking markets. The Ireland, the Portugal and, to a lesser extent, the Greece will take an important test these days. The Irish Government must now use the market to lift up to 1.5 billion euros of debt at 4 and 8 years. This operation takes place in a poisonous climate for the country. Risk indicator - CDS (credit default swap") - comes from a peak, 430 basis points, while rumors circulated last week about a use next in the country to the international monetary fund. These sounds were contradicted, but uncertainty remains high as long as the cost of the rescue of the banks is not known. The Governor of the Irish Central Bank wanted reassuring: "the cost is manageable under public finance national and much less costly than what some alarmist comments have suggested," said yesterday Patrick Honohan, while inviting the Government to accelerate the pace of deficit reduction to keep the confidence of investors. Earlier, former boss of the Irish debt Agency found that the rescue of the banking system would amount to EUR 40 billion, well above estimates which were previously. The amount about Anglo Irish Bank, the main Bank of the country, should be soon revealed.

Yesterday, the premium risk the Ireland bond - i.e. the additional remuneration that must carry out the country from the Germany reached approximately-a 399 points, while the 10-year rate rose to its highest ( 17 points to 6.45).

Variety of situations

This resurgence of tensions, very sensitive since some sessions, led the European Central Bank to increase its purchases of sovereign bonds on the market. Last week, it purchased securities EUR 323 million. Institute of emission would have particularly strengthened its purchases of Irish debt, from Portuguese and Greek titles.

The Portugal also is in a delicate situation. Award paper at 1 year last week testified to a decrease in appetite of investors. Not only the demand has been lower than the beginning, but the Portugal has paid the highest rate of the year on short-term borrowing. The show tomorrow, with maturities of 4 and 10 years, is therefore highly anticipated. Before this deadline, the Portuguese rate 10 years tended yesterday by 30 points to 6.39 and the gap with the German rate climbed to 393 basis points.

In contrast, the Greece, which must now lift the 3-month Treasury bills, saw its CDS unwind, from 910 to 835 basis points. The previous issuance of short term this month was well held, raising even the interest of foreign investors generally more appetite for long term papers. In the case of the Greece, investors consider that the "T-Bills" offer an opportunity to return without a more distant risk of default or restructuring. The country is currently conducting a campaign across Europe. Clearly, the announcement of a postponement of the "stress tests" Greek banks (of a month) has been without impact. Herman Van Rompuy, President of the Union, indicated yesterday that European leaders were ready to act: "we have all done what was possible to defend the euro, we are ready to start over.