What Markets Need to Watch in Portugal as Leftists Vow to Oust PM

Antonio Costa is proposing to lead a Socialist Party government with the support of the Communists, Left Bloc and Greens in parliament.

Paulo Duarte/Bloomberg
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Portugal's opposition party has formed an alliance with three other leftist groups to oust Prime Minister Pedro Passos Coelho at a vote Tuesday and form an alternative government.

The move risks leading to a reversal of austerity measures, confrontation with the European Union over the country's debt reduction plans and the possibility of new elections as early as next year, analysts say.