Ireland Swaps Surge to Record on Anglo Irish Bailout Cost Wager
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The cost of insuring against default on Ireland’s government debt surged to a record as Standard & Poor’s said the price of bailing out nationalized lender Anglo Irish Bank Corp. could exceed $47 billion.
Credit-default swaps tied to Irish bonds jumped as much as 33 basis points to 521.5 after more than doubling in the past two months, and were at 493 basis points as of 4 p.m. in London, according to data provider CMA. Contracts on Anglo Irish rose 4 basis points from yesterday’s record high closing price to 940, implying a 56 percent probability of default within five years.